The 28 EU ministers met under growing pressure from the US and Britain to step up sanctions after the downing of a Malaysian Airlines plane last week in an area of eastern Ukraine controlled by Russian-backed separatists.
German Foreign Minister Frank-Walter Steinmeier said that while Berlin was still willing to talk with Russia, greater economic pressure was needed to make Moscow change course. I say we remain open to defusing the situation with all political and diplomatic means but it will be necessary to accompany this willingness with higher pressure, which also means sharper measures, he told reporters on arrival.
Several other ministers called for an arms embargo on Russia to try to stem a flow of weapons that is fuelling the conflict, including surface-to-air missiles suspected of bringing down the airliner.
The severity of the EU response could depend on the Netherlands, which suffered the greatest loss of life when flight MH17 en route from Amsterdam to Kuala Lumpur crashed last Thursday 193 of the 298 people killed were Dutch.
Washington says the plane was brought down by a surface-to-air missile fired from territory in eastern Ukraine held by pro-Russian separatists.
US President Barack Obama has piled pressure on Europe for a more forceful response, and the three leading EU powers Britain, France and Germany said they should be ready to ratchet up sanctions.