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President Barack Obama, center rear, gathered with G7 world leaders clockwise from center left, European Council president Herman Van Rompuy, Canadian Prime Minister Stephen Harper, French President Francois Hollande, British Prime Minister David Cameron, US President Barack Obama, German Chancellor Angela Merkel, Japanese Prime Minister Shinzo Abe, Italian Prime Minister Matteo Renzi and European Commission president Jose Manuel Barroso, in The Hague, Netherlands, Monday March 24, 2014, in the sidelines of the Nuclear security Summit. In a day of delicate diplomacy he sought to rally the international community Monday around efforts to isolate Russia following its incursion into Ukraine. Nuclear terrorism was the official topic as Obama and other world leaders streamed in to a convention center in The Hague for a two-day Nuclear Security Summit. But the real focus was on a hurriedly scheduled meeting of the Group of Seven industrialized economies to address the crisis in Ukraine on the sidelines of the nuclear summit.Jerry Lampen

The Group of Seven industrial nations is moving to further isolate Russian President Vladimir Putin over his seizure of Crimea, barring Moscow from its meetings and warning of co-ordinated economic sanctions.

Prime Minister Stephen Harper is signalling those sanctions could well target Russia's petroleum sector, a key source of export earnings for that country. "We're tasking our energy ministers to meet – that's a very sensitive area, as you know – so we can examine what the options are available to us longer term to continue the pressure on the Putin government," he said.

The fresh censure of Moscow came as Ukraine told its remaining troops to leave the Crimean peninsula for their own safety and Russian troops forced their way into a Ukrainian marine base in the port of Feodosia on Monday.

G7 leaders, who met Monday for about 90 minutes on the sidelines of a nuclear security summit in The Hague, said they are suspending their participation in the Group of Eight and will instead meet as the G7 until Moscow "changes course."

The G7, which stopped short of formally expelling Moscow from the G8, also warned it is prepared to slap co-ordinated sanctions on Russia's business sectors if Mr. Putin escalates this crisis.

G7 leaders announced they are cancelling a G8 summit with Russia in the Olympic city of Sochi set for June – and instead holding a G7 meeting in Belgium. Russia has been meeting with Western powers as a member of the G8 since 1998.

A senior Canadian official, speaking on a not-for-attribution basis, said German Chancellor Angela Merkel – who has functioned as an intermediary with Russia – played a key role in bringing European support to the table for the latest effort to censure Mr. Putin.

In a joint statement, the G7 said it won't meet as the G8 until Russia backs down from its "illegal attempt to annex" the Black Sea peninsula.

"This group came together because of shared beliefs and shared responsibilities. Russia's actions in recent weeks are not consistent with them. Under these circumstances, we will not participate in the planned Sochi summit," the G7 leaders said.

"We will suspend our participation in the G8 until Russia changes course and the environment comes back to where the G8 is able to have a meaningful discussion," the leaders said.

Russian Foreign Minister Sergei Lavrov played down Monday's developments, saying it wouldn't be a "great tragedy" if his country were expelled from the G8, which began as a means of encouraging former president Boris Yeltsin's political and economic reforms.

"If our Western partners think that this format has outlived itself, then so be it. At the very least, we are not trying to hold on to this format, and we see no great tragedy if it [the G8] does not meet," Mr. Lavrov said in a news conference, hinting that co-operation on issues such as the civil war in Syria and North Korea's nuclear program could suffer as a result.

Mr. Harper scoffed at Russia's efforts to play down its exclusion from the club of leading industrialized nations.

"A regime does not spend $50-billion on the Olympics if it does not care about its international reputation," he told reporters.

Analysts in Russia say the Kremlin decided before sending troops into Crimea that confrontation with the West, including the potential loss of its G8 membership, was an acceptable price for regaining the peninsula, which was part of the Russian Empire for two centuries before the 1991 collapse of the Soviet Union. Moscow is also intent on destabilizing the new government in Kiev, which it regards as illegitimate.

One loser of Russia's estrangement from the G8 will be the city of Sochi, which recently hosted the Winter Olympics after a $51-billion overhaul that was largely paid for from Russian state coffers. Sochi's now empty venues were due to host the G8 summit in June, but will now sit idle until a Formula One race in October.

Mr. Lavrov was more defensive when it came to Russia's position on the wider Group of 20, which has begun to supplant the G8 as emerging markets such as China, India and Latin America have gained in importance. Australia has hinted that Mr. Putin might not be invited to a November summit in Brisbane, a move Mr. Lavrov said was beyond the host country's power.

"The G20 was not established by Australia, which voiced the proposal not to invite Russia to the meeting. We created the format all together," Mr. Lavrov said.

His position was backed Monday by the BRICS group of emerging powers which, besides Russia, includes Brazil, India, China and South Africa. BRICS expressed "concern" at the idea Mr. Putin and Russia might not be invited to Brisbane.

"The custodianship of the G20 belongs to all member-states equally and no one member-state can unilaterally determine its nature and character," read a joint statement released by BRICS foreign ministers.

The latest effort to ratchet up pressure on Russia came hours after Moscow slapped an entry ban on 13 Canadian lawmakers and senior civil servants in retaliation for punitive sanctions Ottawa has levied on Russian decision makers.

The sanctions announced by Moscow on Monday are largely symbolic and do not target Mr. Harper, or Foreign Affairs John Baird. Instead they cover a handful of senior Canadian civil servants, a couple of senior-ranking Conservatives, three Tory backbenchers and two outspoken opposition critics.

Mr. Baird called Moscow's travel ban a "badge of honour" for Canada.

With a report from Reuters