The crisis was set off last month when Ukrainian President Viktor Yanukovych stunned EU leaders by walking away from an association agreement he was about to sign, giving his country free-trade access and closer political ties with the world's biggest economic bloc.
What forced Yanukovych's hand was Russia. Alarmed that it could see the once-Soviet satellite slip out of its orbit, Russia imposed restrictions on Ukrainian imports and threatened to ramp up the price of natural gas, on which the country depends, if the accord went through.
Yanukovych's about-turn unleashed the biggest protests in Ukraine since its pro-democracy revolution in 2004. The country was ripped apart along a historic faultline between its Ukrainian-speaking western Catholic part and its Russian-speaking Orthodox Christian eastern half. It also divided along generational lines, with many younger people rallying to the EU and the democracy and prosperity that they believe it represents, and older people leaning towards Moscow, a familiar ally.
In one episode, riot police severely beat protesters in a bid to reclaim Kiev's main square, prompting the threat of sanctions by the US.
As the turmoil in Ukraine has intensified, the already difficult relationship between Russia and the EU has polarised. The two sides have stepped up their wooing of Yanukovych, to the backdrop of a fierce verbal assault by Moscow.
Lavrov, in an interview with Rossiya 24 TV news channel, accused the EU of seeking to blackmail Ukrainians into a deal to flood their country "with more competitive products and wipe out their industries".
EU Enlargement Commissioner, Stefan Fule, tweeted yesterday: "Ukraine: Words and deeds of President and government regarding #AssocAgreement further and further apart. Their arguments have no grounds in reality."
Michael Leigh, former director for enlargement and neighbourhood policy at the European Commission, now senior adviser to the German Marshall Fund, a transatlantic think-tank, told the Herald by email: "Russia views Ukraine as the terrain for a zero-sum struggle with the West."
Roderick Parkes, head of the EU programme at the Polish Institute of International Affairs in Warsaw, said: "It's rather hotter and [more] dynamic than the Cold War, partly because the stakes are not mutual annihilation." Under pressure but hedging his bets, Yanukovych, 63, is playing off both sides to drive up the offers for his debt-stricken country of 46 million, said Parkes. Russian President Vladimir Putin offered Ukraine a place alongside Russia, Belarus and Kazakhstan in a customs union that would extend from the EU's eastern borders to the Pacific, and rival China, the EU and the United States. The pair also held several meetings in which Putin reportedly offered cheap gas and low-cost loans. Ukraine has to repay US$7 billion ($8.4 billion) in hard currency next year.
With the Russian offer under his belt, Yanukovych then turned to the EU, effectively putting a 20 billion ($33 billion) price tag on signing the accord, saying Ukraine wanted a loan of this amount for investment. Brussels, which has offered 610 million, rejected the idea, saying Ukraine's future "cannot be subject to a tender where the highest bidder gets the prize".
It then sweetened its position, suggesting it could help secure a loan, of unspecified amount, with the International Monetary Fund and the World Bank.
The EU must carefully judge how to use its advantage in so-called soft power over Moscow, which is hobbled by Putin's autocratic image, say observers. Time is short, as Yanukovych and Putin are scheduled to meet in Moscow tomorrow.
