Russia’s president Vladimir Putin has ordered troops into eastern Ukraine after recognising two Moscow-backed separatist regions, hobbling the prospects of a diplomatic solution to the crisis as he put his country on a war footing.

Putin directed his military to enter rebel-held regions in Ukraine’s Donbas border area for “peacekeeping” operations after signing decrees pronouncing their independence.

Russia’s Moex index plunged as much as 14.2 per cent yesterday, while Brent crude, the international oil benchmark, jumped as much as 2.4 per cent today to a new seven-year high.

In an angry televised speechPutin cast doubts over Ukraine’s statehood and accused the west of using the country as a tool to destroy Russia.

The decrees and military order sparked international condemnation as the US and European allies vowed to respond with sanctions. The UK will announce sanctions today, according to Liz Truss, foreign secretary, in immediate reprisals against Moscow’s “breach of international law and attack on Ukraine’s sovereignty” and territorial integrity”.

Tomorrow we will be announcing new sanctions on Russia in response to their breach of international law and attack on Ukraine’s sovereignty and territorial integrity.

— Liz Truss (@trussliz) February 21, 2022

• Opinion: There is incredulity among western leaders as they debate the threat of a major conflict within days, writes Gideon Rachman.

• Go deeper: Russia’s threats to invade Ukraine are forcing China to strike a balance between President Xi Jinping’s growing support for Putin and Beijing’s self-interest in the region’s stability.

Thanks for reading FirstFT Europe/Africa. What questions do you have about the crisis in Ukraine? Share them with us at [email protected] — Jennifer

Five more stories in the news

1. Mumford & Sons founder’s venue venture raises $50mn Musicians, tech billionaires and international financiers have backed the first external fundraising of the Venue Group Hospitality, a British music business set up by a founding member of the folk rock band and his brother, a former finance director of Soho House North America, for a US expansion.

2. Crypto pushes into regulated derivatives markets Volumes in cryptocurrency derivatives registered almost $3tn last month, accounting for more than 60 per cent of crypto trading, as companies sought to meet demand from retail traders for supercharged bets on digital assets.

3. Virgin Hyperloop axes half its staff in freight refocus The US company, which is backed by UAE government logistics group DP World and Sir Richard Branson’s Virgin Group, said 111 people were laid off on Friday as it pivots from passenger travel to delivering a cargo version of its experimental high-speed transport system.

4. Swiss banks struggle to move on from murky past Switzerland’s attempts to shed its reputation as the banking centre for oligarchs, corrupt officials and drug smugglers have been dealt a blow by the leak of documents detailing the accounts of 30,000 Credit Suisse clients. Shares among the country’s banks fell further than most EU lenders yesterday.

5. Jamal Edwards dies aged 31 The music pioneer was a crucial figure in the rise of black British artists to mainstream pop dominance. An energetic entrepreneur, his death following an undisclosed illness has caused shock.

Coronavirus digest

• Boris Johnson has announced the ending of all remaining coronavirus legal restrictions in England. The decision appeared premature, driven by political expediency rather than public health, writes our editorial board.

• Kate Bingham, former head of the UK’s Vaccine Taskforcesaid the regulator’s ability to move nimbly during the pandemic was attracting biotech companies.

• Tens of thousands of residents have left Hong Kong since pandemic travel restrictions came into place in 2020, as the city’s outbreak hit another record yesterday.

• The G20 has pledged $60bn of extra money for developing nations struggling under the financial impact of the pandemic, falling short of expectations.

• The response of rich countries and multilateral institutions to the pandemic’s financial impact on poor countries was inadequate and ignored the concerns of governments and the private sector, said Ghana’s finance minister.

The day ahead

Scotland’s Covid-19 strategy First minister Nicola Sturgeon is to publish the government’s longer-term virus strategy. She previously indicated she was reluctant to match plans that would in effect scrap remaining restrictions this month.

• Also on the pandemic: The ILO Global Forum for a Human-centred Recovery beginswith speakers including IMF managing director Kristalina Georgieva.

Corporate earnings InterContinental Hotels Group reports preliminary full-year results.

Economic data The UK releases public sector finances and the CBI industrial trends survey, Germany’s Ifo Institute monthly business confidence index is due and Italy has January inflation. The US has the IHS Markit flash composite PMI, consumer confidence data and a house prices index, which is expected to have risen more than 18 per cent from a year earlier. (FT, WSJ)

To give school students the latest insights on climate change, the FT is hosting a free digital event on March 1. Sign up here and look out for our Climate Change for Schools report on March 19 packed with stories, graphics and tips on how young people can make an impact.

What else we’re reading

How Xi Jinping’s anti-corruption crusade went global Since coming to power in 2012, the Chinese leader has targeted both “tigers and flies”, or high- and low-ranking government officials, with a clear purpose: to eliminate corruption and eviscerate political rivals. A decade later, there is no end in sight and the hunt for fugitives overseas has accelerated.

Governments should not foot the bill for stranded assets Four European governments are being sued for almost €4bn over restrictions around coal, oil and gas projects. But the prospect of “bailing out” fossil fuel projects risks disincentivising the steps needed now, from both markets and government, to secure swift decarbonisation, writes our editorial board.

European bank shares are experiencing a false dawn Look at the share-price charts for Europe’s banks and one fact is unmissable: investors are finally feeling confident about their prospects. But hopes of fatter margins on lending are offset by certain risks, writes Patrick Jenkins.

The race in financial regulation is a bad strategy There is only one sort of race in such regulation: to the bottom, writes Helen Thomas. That’s worth remembering in the UK’s hurry to overhaul European financial rules to show the benefits of the glorious freedom gained by leaving the EU.

Peloton’s plan to conceal rust Last autumn, the home fitness company was confronted with a crisis: the paint was flaking off some of its exercise machines. Instead of returning the bikes to the manufacturer, executives hatched a plan, dubbed “Project Tinman”to conceal the corrosion and send the machines to customers.

Books

An essay on carnivore confusion, a whimsical Neil Gaiman story gets a graphic twist, non-fiction on the family fortunes of the Sassoons and how creative writing was used as a cold war weapon, plus small-town stories from rural Ireland and more. Catch up on our best books of the week.