Since protests in Kyiv led to the ousting of Yanukovych in February, events have escalated in Ukraine. The country is split between pro-Russian sentiment in the east and those favoring closer ties to the EU in the west.
Massive protests against the pro-Russian course of Viktor Yanukovych throughout the winter of 2013-2014 culminated in a spiral of violence at the end of February. Ukraine's political opposition took over the government after Yanukovych fled the country. Russia then mobilized its military to protect its interests in Crimea and supported a May 16 referendum which led to Crimea's annexation to Russia. In early April, pro-separatist activists in eastern Ukraine took control of key government buildings and established barricades and checkpoints. On 3 May, Ukraine's armed forces began an offensive aimed at re-establishing control in eastern Ukraine. On 12 May, Russia said it "recognized" the results of contested separatist referenda held one day earlier in the provinces of Donetsk and Luhansk. The European Union and the United States now see themselves in one of the potentially most dangerous conflicts since the end of the Cold War.
Russian markets have been rattled by Western sanctions and the rapid fall in the price of oil. The Ruble has lost almost half its value since January and many Russian companies can't afford to make purchases in western Europe any more. The economic ripples caused by the Ukraine crisis are slowly being felt by Germany's engineering sector.