US President Joe Biden has announced a set of sweeping sanctions targeting Russia's ability to do business with the West, asserting that his Russian counterpart Vladimir Putin's decision to order troops into parts of eastern Ukraine was "a flagrant violation of international law".

Announcing the "first tranche" of US sanctions on Russia for its moves against Ukraine, including on two large financial institutions, Russian sovereign debt and Russian elites and their family members, Biden said the American actions would effectively "cut off Russia's government from Western finance."

In a brief address from the White House on Tuesday, Biden also announced that he was moving additional troops and equipment to "strengthen" US allies in the Baltic nations on NATO's eastern flank, but made clear they would not be there to "fight Russia."

Biden called Putin's actions, including ordering Russian troops into Luhansk and Donetsk, the two separatist-held regions of eastern Ukraine after declaring them independent, as a "flagrant violation of international law."

Biden also asked, "Who in the Lord's name does Putin think gives him the right to declare new so-called countries on territory that belonged to his neighbours?"

Putin bizarrely asserted that these regions are no longer part of Ukraine and their sovereign territory. To put it simply, Russia just announced that it is carving out a big chunk of Ukraine, Biden said.

"He's setting up a rationale to take more territory by force in my view. And if we listen to his speech last night, he's setting up a rationale to go much further. This is the beginning of a Russian invasion of Ukraine as he indicated and asked permission to be able to do from his Duma," the US President said.

Meanwhile, US Secretary of State Antony Blinken has announced that he has cancelled plans to meet his Russian counterpart Sergey Lavrov in Geneva later this week since Russia was going ahead with the recognition of the two separatist regions of Ukraine.

While Blinken cancelled his planned meeting with Lavrov, Biden said the US remains open to diplomacy.

"There is still time to avert the worst-case scenario that will bring untold suffering to millions of people," he said.

For months, the US and its allies have vowed to impose severe sanctions on Russia should it choose to invade Ukraine. On Tuesday, Biden said the moment has come.

"Russia has now undeniably moved against Ukraine," he said.

Biden said the sanctions have been closely coordinated with America's allies and partners and will continue to escalate sanctions if Russia escalates.

"We're implementing full-blocking sanctions on two large Russian financial institutions, V.E.B. and their military bank. We're implementing comprehensive sanctions on Russian sovereign debt.

"That means we've cut off Russia's government from Western financing. It can no longer raise money from the West and cannot trade in its new debt on our markets or European markets either," he said.

From Wednesday, and continuing in the days ahead, the US will also impose sanctions on Russia's elites and their family members. "They share in the corrupt gains of the Kremlin policies and should share in the pain as well. Because of Russia's actions, we work with Germany to ensure Nord Stream 2 will not, as I promised, will not move forward, Biden said.

"As Russia contemplates its next move, we have our next move prepared as well," he said.

Biden said that in response to Russia's admission that it will not withdraw its forces from Belarus, he has authorised additional movements of US forces and equipment already stationed in Europe to strengthen its Baltic allies: Estonia, Latvia and Lithuania.

Let me be clear: These are totally defensive moves on our part. We have no intention of fighting Russia. We want to send an unmistakable message, though, that the United States, together with our allies, will defend every inch of NATO territory and abide by the commitments we made to NATO.

We still believe that Russia is poised to go much further in launching a massive military attack against Ukraine. Hope I'm wrong about that, hope we're wrong about that, but Russia has only escalated its threat against the rest of Ukrainian territory, including major cities and including the capital city of Kyiv. There are still well over 150,000 Russian troops surrounding Ukraine, Biden added.