New Zealand has no intention at present of withdrawing its ambassador to Russia but this remains an option if the situation in Ukraine worsens over coming days, Foreign Affairs Minister Murray McCully says.
Russia is moving more troops into Crimea after Russian President Vladimir Putin declared Moscow had the right to intervene to protect Russian citizens in Ukraine. The decision has sparked the biggest crisis between Russia and the West since the Cold War.
Russia defended its action on Tuesday at an emergency session of the United Nations Security Council in New York, but denied issuing an ultimatum to Ukrainian forces there to surrender or face assault. Russian envoy Vitaliy Churkin said the ousted Ukrainian president Viktor Yanukovych asked by letter for Moscow's intervention to protect civilians and prevent civil war.
"Under the influence of Western countries, there are open acts of terror and violence," Mr Churkin quoted the letter as saying.
American ambassador to the UN Samantha Power said Russia was responding to an imaginary threat. The US announced it was suspending bilateral trade and investment talks with Russia, and any military cooperation between the countries was being put on hold.
The New Zealand Parliament on Tuesday expressed deep concern at Russia's violation of Ukraine's sovereignty and territorial integrity.
Mr McCully moved the motion without notice before Question Time, telling MPs that New Zealand is calling for the withdrawal of Russian troops.
"Over the past few days we've seen troops from the Russian Federation take steps that have placed them in effective control of the autonomous region of Crimea in Ukraine. In doing so, Russia has breached its own bilateral treaties with Ukraine, important principles of international law and the accepted norms of international conduct."
The minister said as a small country which relies on good institutions and solid rules, New Zealand cannot and will not take that lightly and what is needed now is constructive dialogue in the place of provocation and threats.
Labour Party MP David Shearer told Parliament the escalation of tensions in Ukraine threatens the security of Europe in a way not seen since the Balkan conflict in the early 1990s.
"The prospect of a divided Ukraine - it is likely to lead to conflict and have disastrous knock-on effects right across Eastern Europe."
Mr Shearer said Russia must withdraw its troop immediately and start constructive dialogue.
Asked by reporters whether New Zealand was considering recalling its ambassador from Moscow, Murray McCully said the Government would wait and see what emerged over the next few days.
"That's something that we would consider if we thought circumstances required it. It's not our agenda at the moment."
Prime Minister John Key said on Monday the free trade deal New Zealand was negotiating with Russia was on hold for the time being.