The 57 member countries of the OSCE reached a consensus, initially agreeing to send 100 observers to monitor the political and security situation in Ukraine.

A further option exists to expand the number to 500.

The decision came after Russia - which is one of the members - was understood to have dropped its objection to the deployment. The mission is to be based in the Ukrainian capital Kyiv and be deployed to nine areas of the country - including the largely Russian-speaking city of Donetsk.

However, the Black Sea peninsula of Crimea - which Russian signed a decree earlier this week to annex into its own territory - was not on the list of places the monitors will visit.

Western nations - Germany in particular - have called for an observer mission as a means of calming the situation, particularly in the south and east of the country where there is a large Russian-speaking population.

'Not the end, but a step'

The agreement is rare instance of consensus between Russia and the West concerning the Ukraine. German Foreign Minister Frank-Walter Steinmeier expressed relief and optimism at the decision.

"I am happy that we are able to send the OSCE observers on their way," said Steinmeier, who was himself due to visit Ukraine on Saturday. "It is not the end of the crisis, but a step that helps our efforts to support de-escalation."

"The situation in Ukraine remains unstable and menacing. For this reason… observers must take up their work as quickly as possible."

Steinmeier is expected to meet Ukraine’s interim president Oleksandr Turchynov in Kyiv on Saturday morning to discuss the crisis. Canadian Prime Minister Stephen Harper is also due to meet with Turchynov later in the day.

On Friday, the EU signed an association agreement with Ukraine. Former Ukrainian president Viktor Yanukovych opted not to sign the agreement in November last year, leading to the Kyiv uprising that overthrew him.

EU 'should have waited'

The Russian government dismissed the pact, saying the current Ukrainian government has no democratic mandate, and that the EU should have waited until after fresh elections.

The situation reached its tensest yet earlier this week, following Russian President Vladimir Putin's signing of the annexation document. Pro-Russian militias took over several Ukrainian military bases in Crimea, with one Ukrainian serviceman reported killed on Tuesday.

Meanwhile, both the EU and US on Tuesday imposed sanctions against Russian and Ukrainian officials and lawmakers, measures that were derided by Moscow. Both Brussels and Washington widened their lists of individuals affected later in the week.

rc/jlw (AFP, AP, dpa, Reuters)