Ukraine mobilized for war on Sunday and Washington threatened to isolate Russia economically, after President Vladimir Putin declared he had the right to invade his neighbour in Moscow's biggest confrontation with the West since the Cold War.

"This is not a threat: this is actually the declaration of war to my country," Ukraine's Prime Minister Arseny Yatseniuk, head of a pro-Western government that took power when Russian ally Viktor Yanukovich fled last week, said in English.

Putin secured permission from his parliament on Saturday to use military force to protect Russian citizens in Ukraine and told U.S. President Barack Obama he had the right to defend Russian interests and nationals, spurning Western pleas not to intervene.

U.S. Secretary of State John Kerry called Russia's military incursion into Ukraine "an incredible act of aggression." Kerry will travel to Kyiv, Ukraine, on Tuesday to stress U.S. political and economic support.

Russian forces have already bloodlessly seized Crimea â€” an isolated Black Sea peninsula where Moscow has a naval base. On Sunday, they surrounded several small Ukrainian military outposts there and demanded the Ukrainian troops disarm.

'Dangerous course of actions'

Canada's Foreign Minister John Baird condemned Russia's moves and called on Putin to stop his "provocative and dangerous course of actions," urging the Russian leader to withdraw his troops in the Crimea back to their bases. He reiterated that Canada had recalled its ambassador in Moscow and is boycotting the G8 preparations in Sochi, in a news conference Sunday from Toronto.

The minister sidestepped questions about a boycott and when questioned about sanctions, he spoke about Canada talking to allies, NATO and the UN about further steps. 

"Non-participation in the G8 will hurt Russia," said NDP Leader Tom Mulcair at a Sunday news conference. "Having the international community condemn as one this totally illegal invasion of a sovereign country will help send a signal even to the most obtuse regime like the Putin regime."

In Kyiv, the Ukrainian capital, Yatsenyuk said there was no reason for Russia to invade Ukraine and warned that "we are on the brink of disaster."

But so far, his new government and other countries have been powerless to stop Russia's military tactics. Armed men in uniforms without insignia have moved freely about the peninsula, occupying airports, smashing equipment at an air base and besieging a Ukrainian infantry base.

"Ukraine is calling up all army reservists, getting this country combat ready," CBC News correspondent Susan Ormiston said, reporting from Crimea. "We were at a naval base not far from the capital of Crimea, where hundreds of Russian troops have surrounded the base. They blocked the gates with the Ukrainian army inside, but no violence."

Ormiston said there are reports the Ukrainian army is trying to protect its own caches of munitions.

"The city feels like it's still functioning. The doors are open," CBC News correspondent Nahlah Ayed reported from Western-sympathetic Kyiv. "But there's definitely apprehension here. They don't know where it's going. But this isn't really tangible on the ground as you are travelling around Kyiv."

The BBC is reporting that Russian soldiers are digging trenches where the Crimea peninsula meets the mainland.

Ukrainian officials announced Sunday that the head of the country's Black Sea fleet has been removed and is under investigation for treason. They say Denis Berezovsky did not provide resistance when the Russian army seized the port of Sevastopol, the headquarters of Ukrainian naval forces.

Russia has long wanted to reclaim the lush Crimean Peninsula, which was part of Russia until 1954. Its Black Sea Fleet is stationed there and nearly 60 per cent of Crimea's residents identify themselves as Russian.

Ukraine's population of 46 million has divided loyalties between Russia and Europe, with much of western Ukraine advocating closer ties with the EU, while eastern and southern regions like Crimea look to Russia for support.

Unidentified troops pulled up to the Ukrainian military base at Perevalne on the Crimean Peninsula in a convoy that included at least 13 trucks and four armoured vehicles with mounted machine guns. The trucks carried 30 soldiers each and had Russian licence plates.

Standoff at Ukrainian military base

A dozen Ukrainian soldiers placed a tank at the base's gate, leaving the two sides in a tense standoff.

Ukraine's acting president, Oleksandr Turchynov, announced late Saturday that he had ordered Ukraine's armed forces to be at full readiness because of the threat of "potential aggression."

Turchynov also said he had ordered stepped-up security at nuclear power plants, airports and other strategic infrastructure.

But the U.S. and other Western governments have few options to counter Russia's military moves.

Countries pulling out of pre-G8 meetings

In Brussels, NATO's secretary general said Russia had violated the UN charter with its military action in Ukraine, and he urged Moscow to "de-escalate the tensions."

Ukraine

Unidentified armed men patrol Sunday around a Ukrainian infantry base in Perevalne, a village in Crimea. (Darko Vojinovic/Associated Press)

NATO chief Anders Fogh Rasmussen spoke before a meeting Sunday of the alliance's political decision-making body to discuss the crisis and asked "all parties to urgently continue all efforts to move away from this dangerous situation."

Ukraine is not a NATO member, meaning the U.S. and Europe are not obligated to come to its defence. But Ukraine has taken part in some alliance military exercises and contributed troops to its response force.

Kerry, interviewed on Sunday news shows in the U.S., raised the possibility of boycotting the G8 summit, which is to be held in June in Sochi, the Russia resort that just hosted the Winter Olympics. He also discussed visa bans, asset freezes, and trade and investment penalties.

U.S. President Barack Obama spoke with Putin by telephone for 90 minutes Saturday and expressed his "deep concern" about "Russia's clear violation of Ukrainian sovereignty and territorial integrity," the White House said. Obama warned that Russia's "continued violation of international law will lead to greater political and economic isolation."

In Moscow, thousands marched Sunday in a pro-invasion rally one day after Russia's parliament gave Putin a green light to use military force in Ukraine. At least 10,000 people bearing Russian flags marched freely through the city, while dozens of people demonstrating on Red Square against an invasion of Ukraine were quickly detained by Russian riot police.

The new Ukrainian government came to power last week following months of pro-democracy protests against a pro-Russian president, Viktor Yanukovych, and his decision to turn Ukraine toward Russia instead of the European Union.

Yanukovych fled to Russia after more than 80 people died, most of them demonstrators killed by police. He insists he's still president.

Since then, tensions have risen sharply between the two capitals.

Referendum planned on Crimea's future

The Interfax news agency reported the speaker of Crimea's legislature, Vladimir Konstantinov, as saying the local authorities did not recognize the government in Kyiv. He said a planned referendum on March 30 would ask voters about the region's future status.

The White House said the U.S. will suspend participation in preparatory meetings for the Group of Eight economic summit planned.

Susan Ormiston

CBC correspondent Susan Ormiston is in Ukraine. Follow her reports on CBC News Network during the day and each night on CBC's The National. You can follow her on Twitter @Ormistononline

Canadian athletes will still compete in the upcoming Paralympics in Sochi, the Prime Minister's Office said late Saturday. The games are set for March 7 to March 16.

Also on Saturday, Prime Minister Stephen Harper said Canada supports the United Nations sending international monitors to Ukraine and is also involved in multilateral talks to put together a financial aid package for the beleaguered country.

On Sunday, Britain said it will suspend its participation in preparations for a G8 meeting in Sochi. British Prime Minister David Cameron said U.K. cabinet ministers will stay away from the Sochi Paralympics due to the conflict in Ukraine.

French Foreign Minister Laurent Fabius said on Europe 1 radio that planning for the summit should be put on hold. France "condemns the Russian military escalation" in Ukraine, and Moscow must "realize that decisions have costs," he said Sunday.

"We are on a very dangerous track of increasing tensions," German Foreign Minister Frank-Walter Steinmeier said in a statement. "[But] it is still possible to turn around. A new division of Europe can still be prevented."

With files from CBC News