Obama says hopeful but sceptical of Ukraine ceasefire

NEWPORT (NasdaqGS: NEWP - news) , Wales, Sept 5 (Reuters) - U.S. President Barack Obama said he was hopeful but sceptical about a ceasefire agreed in Ukraine on Friday and urged European allies to agree on new sanctions against Russia that could be suspended if the peace plan holds.

He also said he was leaving a two-day NATO summit in Wales confident that U.S. allies were prepared to join a broad coalition to take action to degrade and ultimately destroy Islamic State militants in Iraq.

"We also sent a strong message to Russia that actions have consequences. Today the United States and Europe are finalising measures to deepen and broaden our sanctions across Russia's financial, energy and defense sectors," Obama told a news conference.

NATO had made clear it would defend every ally, and that it supported Ukraine's sovereignty against what he called Russian aggression, he said.

"With respect to the ceasefire agreement, obviously we are hopeful but based on past experience also sceptical that in fact the separatists will follow through and the Russians will stop violating Ukraine's sovereignty and territorial integrity. So it has to be tested," the president said. (Reporting by Steve Holland and Phil Stewart; Writing by Paul Taylor)