'Glimmer of hope' for Ukraine after deal at Minsk peace summit

But big hurdles remained on the path to peace and German Chancellor Angela Merkel, one of the sponsors of the talks, differed with Russian President Vladimir Putin over the reasons the deal took more than 16 hours of overnight talks to reach.

In a further sign of its fragility, a Ukrainian military spokesman said around 50 tanks, 40 missile systems and 40 armoured vehicles had crossed overnight into eastern Ukraine from Russia. It was not immediately possible to verify the statement. Moscow dismisses such allegations as groundless.

The agreement envisages a ceasefire between Ukrainian forces and Russian-backed separatists starting on Sunday, followed by the withdrawal of heavy weapons from the front line and constitutional reform to give eastern Ukraine more autonomy.

"The main thing which has been achieved is that from Saturday into Sunday there should be declared without any conditions at all, a general ceasefire," Ukrainian President Petro Poroshenko told journalists.

Putin blamed Kiev for the length of the talks, the culmination of a dramatic diplomatic initiative by France and Germany following an upsurge in fighting in which the separatists tore through an earlier ceasefire line.

Merkel on the other hand, said Poroshenko "did everything to achieve the possibility of an end to the bloodshed", while she said Putin put pressure on the separatists to agree to the ceasefire "towards the end" of the talks.

Tensions between Putin and the other leaders were evident at the meeting in Minsk, capital of Russian ally Belarus, and they did not appear together to announce the result.

The fighting has destabilised Ukraine both militarily and economically. As the deal was reached, Ukraine was offered a $40-billion lifeline by the International Monetary Fund to stave off financial collapse.

COMPROMISE

The agreement addressed some of the main stumbling points, including a "demarcation line" separating the separatists from Ukrainian forces, which the rebels wanted to reflect gains from a recent offensive which shredded an earlier ceasefire deal.

The compromise was that the rebels will withdraw weapons from a line set by the earlier Minsk agreement in September, while the Ukrainians will withdraw from the current frontline.

Ukraine will also get control of its border with Russia, but in consultation with the rebels and only after the regions gain more autonomy under constitutional reform by the end 2015.

The ceasefire and heavy weapons pullback would be overseen by Europe-wide security body, the Organisation for Security and Cooperation in Europe.

"We have managed to agree on the main issues," Putin told Russian reporters.

"Why did it take so long? I think this is due to the fact that the Kiev authorities still refuse to make direct contact with the representatives of the Donetsk and Luhansk peoples' republics," he said, referring to two rebel-head regions in eastern Ukraine.

The French and German leaders briefed their media separately while Poroshenko's briefing excluded Russian journalists.

French President Francois Hollande said there was still much work to be done on the Ukraine crisis, but the agreement was a real chance to ameliorate the situation.

He said pro-Russian separatists, who had at one point appeared to reject the deal, had signed up to it.

Pro-Moscow separatists tightened the pressure on Kiev by launching some of the war's worst fighting on Wednesday, killing 19 Ukrainian soldiers in assaults near the railway town of Debaltseve.

As the fighting escalated, Washington has begun openly talking of arming Ukraine to defend itself from "Russian aggression", raising the prospect of a proxy war in the heart of Europe between Cold War foes.

The outcome of the Minsk talks was expected to influence discussions at an EU summit in Brussels on Thursday, when sanctions against Moscow will be on the agenda. A deal could mean a softer line towards Moscow.

FUND BAILOUT

The talks in Minsk took place as an International Monetary Fund mission agreed a bailout to save Ukraine from bankruptcy.

The Fund provisionally agreed a $17.5 billion facility with Ukraine, part of a $40 billion funding package, IMF managing director Christine Lagarde said.

Kiev and NATO accuse Russia of supplying separatists with men and weapons. Moscow denies it is involved in fighting for territory Putin calls "New Russia".

As the French and German leaders peace initiative was announced, pro-Russian rebels appeared determined to drive home their advantage ahead of a deal.

Armoured columns of Russian-speaking soldiers with no insignia have been advancing for days around Debaltseve, which has seen heavy fighting in recent days.

On the Russian side of the border, Moscow has begun military exercises in 12 regions involving more than 30 missile regiments, RIA news agency reported on Thursday, citing a Defence Ministry official.