British Prime Minister David Cameron warned President Vladimir Putin on Sunday that Russia would pay significant costs unless the Kremlin changed course on Ukraine.

Cameron said he had agreed with US President Barack Obama that Russia's actions in Ukraine were completely unacceptable, a Downing Street spokesman said.

"They agreed that Russia's actions were completely unacceptable. They agreed on the urgent need for de-escalation and for Russia to engage in a dialogue directly with Ukraine," the spokesman said.

"They agreed there must be 'significant costs' to Russia if it did not change course on Ukraine," the spokesman said.

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