EU extends sanctions on Russia

"Regretfully, we have seen that there is little progress to be seen" and "constant violations of the ceasefire," Merkel told reporters afterwards.

"Under such circumstances, everybody spoke of the need to extend the sanctions," the chancellor went on, adding that "Germany and France received support regarding the continuation of the Minsk process”.

The EU first imposed sanctions against Russian banks, oil and defence companies, as well as certain officials, in the summer of 2014, following Russia’s annexation of Crimea and its support for separatists in eastern Ukraine.

Sanctions were extended until January 2018.

The EU has made their lifting conditional on Russia’s implementation of the Minsk agreement, which requires that Moscow pressures the separatists into a ceasefire.

Russia, however, denies being involved in the conflict. It also refuses to discuss with international partners its annexation of Crimea, saying the half-island's "reunification" with Russia is a closed case.

According to sources, Merkel said the dialogue with Russia was currently dead-locked.

The EU high representative of foreign affairs, Federica Mogherini, said the Minsk talks must continue, but that the EU could do more. The high representative recently visited Moscow, in a bid to offer more channels for dialogue.

While no EU leader opposed extending the sanctions, and many expressed their support for further Franco-German talks with Russia and Ukraine, some said it was important to also cooperate with Russia, for instance on ways to solve the war in Syria.

Swedish prime minister Stefan Loefven, furthermore, called for an updated picture of the efficacy of the sanctions.

A recent study by the US state department said that EU sanctions have reduced Russian GDP by 1 to 1.5 percent, and the EU’s own GDP by 0.1 percent.

In addition, the EU has lost 0.3 percent of its GDP as a consequence of a Russian counter-embargo on EU food products, which was also introduced in 2014.

The US study said that the countries that are the strongest backers of the sanctions on Russia - the Baltic states, Finland and Poland - paradoxically also are the ones to suffer most from them, while the impact on sanction-critics such as Italy has been limited.

The US has lost a mere 0.005 percent of its GDP because of its own sanctions on Russia and the counter-sanctions. The US senate recently passed a bill that would sharpen US sanctions on Russia, but the proposal has stalled in the US house of representatives.