Merkel: Russia Risks 'Massive' Damage in Ukraine Crisis

German Chancellor Angela Merkel said Thursday that Russia risks "massive" political and economic damage if it does not change course in the Ukraine crisis.

In a speech to the German parliament, Ms. Merkel said Ukraine's territorial integrity is "not up for discussion."

The West and Russia have been locked in a tense standoff over Russia's military incursion into Ukraine's Crimean peninsula.

In Washington, meanwhile, Secretary of State John Kerry told a Senate hearing it is unclear whether Russia is willing to negotiate with Ukraine and the international community to resolve the conflict over Crimea peacefully.

"The question mark is, is Russia prepared to find a way to negotiate with Ukraine, with the contact group, with the other countries involved, in order to be able to resolve this in a way that respects their legitimate interests - and they have legitimate interests - but respects them in a way that doesn't violate international law and isn't at the butt of a rifle and of massive military imprint."

Kerry and his Russian counterpart, Sergei Lavrov, are to discuss Ukraine Friday in a face-to-face meeting in London.

U.S. President Barack Obama warned Russia again Wednesday that the West will "apply costs" to Moscow if it continues to interfere in Ukrainian affairs.

Speaking at the White House alongside interim Ukrainian Prime Minister Arseniy Yatsenyuk, Obama said Washington "completely rejects" Crimea's planned referendum Sunday on whether to secede from Ukraine and join Russia. He said the vote, "patched together in a few weeks," is a violation of international law.

Yatsenyuk thanked Washington for its support, and said his government is "absolutely ready and willing" for talks with Moscow. But he said Ukraine will never surrender. He also said his government is preparing to sign an association agreement with the European Union later this month.

Meanwhile, U.S. Senator John McCain is set to lead a bipartisan delegation to Kyiv Thursday. A spokesman described the visit as a show of congressional support for the interim government, "and for the Ukrainian people's aspirations for freedom, democracy and territorial integrity."

Republican McCain and his Senate Democratic colleague Christopher Murphy visited Kyiv in December, at the height of anti-government protests that eventually forced pro-Russian President Viktor Yanukovych to flee the country.

On Wednesday, leaders of the Group of Seven leading industrialized nations called on Russia to, in their words, "cease all efforts to change the status of Crimea contrary to Ukrainian law."

The G7 - which includes Britain, Canada, France, Germany, Italy, Japan and the United States - also said it will not recognize the referendum's outcome.

In Berlin, German Chancellor Merkel said the European Union will impose sanctions on Russia if it does not move to set up a contact group to discuss the Crimea crisis.