By Andrey Ostroukh and Andrew Osborn

MOSCOW (Reuters) – President Vladimir Putin signed decrees on Monday to recognise two breakaway regions of eastern Ukraine as independent statelets, defying Western warnings that such a step would be illegal and would kill off peace negotiations.

He signed the documents after delivering an astonishing verbal attack on Ukraine in an televised speech lasting nearly an hour, in which he said neo-Nazis were on the rise, oligarchic clans were rife and called Ukraine a U.S. colony with a puppet regime.

Putin said Ukraine was a country with no tradition of independent statehood and an artificial creation of Soviet state founder Vladimir Lenin – a restatement of views he has expounded previously and which Kyiv has rejected as a false and self-serving view of history.

Since the 1991 collapse of the Soviet Union, he said, Kyiv had taken advantage of Russia and subjected it to economic “blackmail”.

Now its aspiration to join NATO posed a direct threat to Russia’s security, he said.

“In NATO documents, our country is officially and directly declared the main threat to North Atlantic security. And Ukraine will serve as a forward springboard for the strike.”

Putin shrugged off Western threats of sanctions in the event of Russian aggression against Ukraine.

“They are trying to blackmail us again. They are threatening us again with sanctions, which, by the way, I think they will introduce anyway as Russia’s sovereignty strengthens and the power of our armed forces grows. And a pretext for another sanctions attack will always be found or fabricated.”

He said Russia “has every right to take retaliatory measures to ensure its own security. That is exactly what we will do.”

Russia’s rouble, already under pressure from a vast Russian military buildup near Ukraine, tumbled to new weeks-long lows as Putin spoke from behind a wooden desk flanked by Russian tricolour flags.

The recognition of the breakaway Ukrainian regions amounts to a declaration by Russia that it no longer considers them to be part of Ukraine.

It could pave the way for Moscow to openly send military forces into both regions, using the argument that it is intervening as an ally to protect them against Kyiv.

Putin said it was a long overdue response to “those who embarked on the path of violence, bloodshed, lawlessness and did not recognize and do not recognize any other solution to the Donbass issue, except for the military one.”

He demanded an immediate cessation of hostilities by Ukraine.

“Otherwise, all responsibility for the possible continuation of the bloodshed will be entirely on the conscience of the regime ruling on the territory of Ukraine,” he said.

Immediately after the conclusion of the speech, state television showed Putin signing documents to recognise the independence of the Donetsk and Luhansk regions at a short Kremlin ceremony attended by their leaders.

(Additional reporting by Alexander Marrow, Tom Balmforth, Maria Kiselyova, Tamara Vaal, Maria Tsvetkova, Darya Korsunskaya, Olesya Astakhova and Tamara Vaal, Writing by Tom Balmforth and Mark Trevelyan; Editing by Alistair Bell)

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