- 14 updates
In a phone call to German Chancellor Angela Merkel, US President Barack Obama said that Russia had to take more steps to de-escalate the situation in eastern Ukraine.
Both leaders agreed that Russia should urge rebels to release hostages and end the flow of heavy weapons and fighters across the Russian border.
"The leaders agreed that to date neither the United States nor Germany has seen Russia fulfill these required actions," the White House statement said.
President and the Chancellor also reaffirmed their commitment to work together as well as to continue to support Ukraine’s long-term stability and prosperity, during the call.
US Vice President Joe Biden has told Ukraine President Petro Poroshenko that the United States was working with European leaders on further sanctions on Russia, over the escalation of the conflict in Ukraine.
"The leaders discussed Russia's ongoing support for the separatists and apparent escalation" the White House said in a statement about the call between the two men.
"The vice president told President Poroshenko that the United States was engaging with European leaders to discuss the imposition of costs on Russia for its continued escalation of the conflict," it said.
The Ukrainian president has again accused Russian army officers of fighting alongside pro-Moscow separatists in the east of the country.
Petro Poroshenko said: "Russian staff officers are taking part in military operations against Ukrainian forces."
The war of words between Kiev and Moscow followed a weekend of intense fighting, in which Ukrainian forces say they inflicted heavy losses on pro-Russian rebels.
A Ukrainian plane taking part in the military campaign against separatist rebels was shot down by a rocket "probably" fired from Russian territory, the country's defense minister was quoted as saying.
Speaking on the country's presidential website Colonel General Valery Heletey said crew members from the military transport plane had been in contact with the army's general staff.
He said that the plane was flying at a height of 6,500 meters and therefore could not have been brought down by weapons used by the separatists.
He added: "The plane was brought down by another more powerful rocket weapon which was fired, probably, from the territory of the Russian Federation."
There was no word on casualties, but a military spokesman was unable to confirm that everyone on board was alive.
Russia said it has invited monitors from the OSCE European security and rights body to two of its borders crossings with Ukraine, as a "sign of good will", the foreign ministry said.
Russia has been building up its forces on the Ukrainian border steadily over the past few weeks and now has an estimated 10-12,000 troops in the area, a Nato military officer said.
Russia had withdrawn the majority of the 40,000 troops it had on the border earlier this year, and there were fewer than 1,000 by the middle of June. Speaking on the condition of anonymity, the officer told Reuters:
"Our current assessment is that between 10,000 and 12,000 troops are now in the area ... In the last week alone, we have seen several units moving into the border region."
German Chancellor Angela Merkel and Russian President Vladimir Putin agreed that the Ukraine situation "has a tendency towards degradation" and have urged greater peace efforts, Putin's spokesman Dmitry Peskov has said.
He said: "Both Putin and Merkel stressed the necessity to urgently resume the work of a contact group on Ukraine.
"It is their common opinion that, in order for the contact group to resume its work, a ceasefire needs to be declared as soon as possible," Peskov said.
The two leaders met briefly before the World Cup final in Brazil.
Ukraine has called an accusation its forces fired across the border "total nonsense".
Kiev suggested the attack, which is said to have killed one person, could have been the work of rebels trying to provoke Moscow to intervene on their behalf. The rebels denied they were responsible.
Inside Ukraine, combat has intensified dramatically since a rebel missile attack that killed dozens of government troops on Friday.
Local officials said on Sunday 18 people were killed in shooting incidents in the two main rebel-held cities.
Ukrainian President Petro Poroshenko will not be appearing at the World Cup in Brazil following reports he may be due to meet Russian leader Vladimir Putin at the final.
A statement said Mr Poroshenko had received an invite from Brazil's President Dilma Rousseff, but felt it was "impossible" to justify the visit "given the situation that is happening in Ukraine".
Russian President Vladimir Putin could meet his Ukrainian counterpart Petro Poroshenko on the sidelines of the World Cup final in Brazil, although no talks were being planned at this point, a spokesman for the Kremlin has said.
"We are not preparing any separate meetings. As far as we know, he is going there too," said Kremlin spokesman Dmitry Peskov in the Argentine capital Buenos Aires.
"There will be some separate room for leaders at the stadium, and therefore one of course cannot rule it (meeting) out," he said on the sidelines of a meeting between Putin and Argentina's president, Cristina Fernandez.