KIEV - Fresh fighting flared in central Kiev on Thursday, shattering a truce declared by Ukrainian President Viktor Yanukovich, as the Russian-backed leader met European ministers demanding he compromise with pro-EU opponents.

A Reuters photographer saw the bodies of 21 dead civilians in Independence Square, a few hundred metres from where the president met the EU delegation, after protesters who have occupied the area for almost three months hurled petrol bombs and paving stones to drive riot police from the plaza.

Acting Interior Minister Vitaly Zakharschenko said police had been issued with combat weapons and would use them "in accordance with the law" to defend themselves and others and to free hostages. The ministry said protesters were holding 67 policemen hostage.

In a sign of dwindling support for Yanukovich, his hand-picked head of Kiev's city administration quit the ruling Party of the Regions in protest at bloodshed in the streets.

The foreign ministers of Germany, France and Poland spent much of the day in Kiev, meeting at length with Yanukovich and extending their stay to talk to opposition leaders.

They sent an interim report to EU colleagues in Brussels, who were meeting to decide on targeted sanctions against those deemed responsible for the worst bloodshed in Ukraine since it left the crumbling Soviet Union 22 years ago.

EU foreign policy chief Catherine Ashton told reporters in Brussels she had spoken twice to the visiting trio and would convey their impressions to the EU meeting. An EU source in Moscow said the ministers saw a chance for a compromise between the authorities and the opposition.

A draft EU statement prepared for the meeting called for "targeted measures" against individuals, an arms embargo and a ban on equipment for internal repression.

Russia criticized the European and U.S. actions, calling them "blackmail" that would only make matters worse. Russian President Vladimir Putin is sending an envoy to Kiev to try to mediate with the opposition at Yanukovich's request, the RIA news agency quoted a Kremlin spokesman as saying.

German Chancellor Angela Merkel called to urge Yanukovich to accept the offer of EU mediation in the crisis.

Raising pressure on Yanukovich to restore order if he wants the next desperately needed loan, Russian Prime Minister Dmitry Medvedev said Moscow would not hand over cash to a leadership that let opponents walk over it "like a doormat".

BOTH SIDES USED GUNS

Ukraine is caught in a geopolitical tug-of-war between Moscow - which sees it as a market and ally and fears protests spreading to Russia - and the West, which says Ukrainians should be free to choose economic integration with the EU.

Thursday's renewed fighting, which subsided after about an hour, heightened concern voiced by Polish Prime Minister Donald Tusk that Ukraine could descend into civil war or split between the pro-European west and Russian-speaking east.

Video from Thursday morning's clashes on the edge of the Kiev square, known as the Maidan or "Euro-Maidan" by protesters, showed both sides used firearms.

"Berkut" riot policemen fired bursts from automatic rifles on the run as they covered retreating colleagues fleeing past a nearby arts center just off the plaza. An opposition militant in a helmet was filmed firing from behind a tree.

Other protesters used police riot shields for cover, while some fell wounded as the protest camp became a killing zone. A Ukrainian presidential statement said dozens of police were wounded or killed during the opposition offensive hours, after Yanukovich and opposition leaders had agreed on a truce.

Witnesses said they saw snipers firing during the clashes. The Health Ministry said two police were among Thursday's dead.

That raised the total death toll since Tuesday to at least 51, including at least 12 police. Local media said more than 30 protesters were killed in Thursday's flare-up. One opposition group doubled that estimate. The protesters' medical service said it was too busy treating casualties to count the bodies.

The interior ministry's website advised citizens to avoid central Kiev because of the danger from "armed and aggressive individuals". Schools and many shops were closed, the metro was shut down and bank machines were running out of cash.

A statement from Yanukovich's office said organized gangs of protesters were using firearms, including sniper rifles.

Opposition leader Vitaly Klitschko urged lawmakers to convene in parliament and demanded Yanukovich call an immediate presidential election. "Today is a crucial day," the former boxing world champion said. "The authorities are resorting to bloody provocations in full view of the world." Legislators gathered in parliament, near the main square, but were a few members short of a quorum to take decisions.

"OFFICIALS PANICKY" Wounded protesters were given first-aid treatment in the lobby of the Ukraine Hotel, where many foreign correspondents are staying. Reporters said there were bullet holes in the walls and windows of the hotel overlooking the square.

"Black smoke, detonations and gunfire around presidential palace ... Officials panicky," tweeted Polish minister Radoslaw Sikorski while waiting for his meeting with Yanukovich, a few hundred meters from the square.

The crisis in the sprawling country of 46 million with an ailing economy and endemic corruption has mounted since Yanukovich took a $15-billion Russian bailout instead of signing a wide-ranging trade and cooperation deal with the EU.

Russia has held back a new loan installment until it sees stability in Kiev and has condemned EU and US
support of the opposition demands that Yanukovich, elected in 2010, should share power and hold new elections.

The United States stepped up pressure on Wednesday by imposing travel bans on 20 senior Ukrainian officials.

"Our approach in the United States is not to see these as some Cold War chessboard in which we're in competition with Russia," US President Barack Obama said after a North American summit in Mexico on Wednesday.

At Russia's Winter Olympics in Sochi, some members of Ukraine's team have decided to leave because of the violence at home, the International Olympic Committee said on Thursday.

In Lviv, a bastion of Ukrainian nationalism since Soviet times, the regional assembly declared autonomy from Yanukovich and his administration, which many west Ukrainians see as much closer to Moscow and to Ukraine's Russian-speaking east.

Yanukovich, who replaced the head of the armed forces, had denounced the bloodshed as an attempted coup. His security service said it had launched a nationwide "anti-terrorist operation" after arms and ammunition dumps were looted.

The EU ministers were considering asset freezes and travel bans, although diplomats doubt their effectiveness. Yanukovich himself would be left off the list to keep channels of dialogue open, EU officials said.

Jumping out ahead of its EU allies, Washington imposed US  visa bans on 20 government officials it considered "responsible for ordering human rights abuses related to political oppression", a State Department official said.

"These individuals represent the full chain of command we consider responsible for ordering the security forces to move against (the protesters)," the official said.

THREAT TO OLIGARCHS

Diplomats said the threat of sanctions could also target assets held in the West by Ukrainian business oligarchs who have either backed Yanukovich or are sitting on the fence.

Ukraine's hryvnia currency, flirting with its lowest levels since the global financial crisis five years ago, weakened again on Thursday. Ukraine's state debt insurance costs rose to their highest since December 2009.

Possibly due to the risk of sanctions, three of Ukraine's richest magnates have stepped up pressure on Yanukovich to hold back from using force.

"There are no circumstances which justify the use of force toward the peaceful population," steel and coal billionaire Rinat Akhmetov, who bankrolled Yanukovich's 2010 election campaign, said in a statement late on Tuesday.

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