Vadym Denyskenko, a highly-respected Ukrainian journalist and editor, [and Crimea specialist] answers the question everyone wants to know - what is Putin's Plan.
Below is my loose translation of his today's Espreso.tv op ed piece:
Civil War. Putin's Plan
The Kremlin's plan is at minimum - the trashing of the presidential elections by the hands of Ukrainians themselves and forcing an official Kyiv to recognize the legitimacy of the separatists. At maximum it includes a civil War
Kyiv has no control over the Donbass.
The region is not controlled by Akhmetov, or anyone else in Ukraine. Donbass is today again controlled by Yanukovych, or more precisely Russia's GRU [Main Intelligence Directorate] which has been, and continues to be part of Yanukovych's circle.
Within two weeks they will clean up Donetsk and Lugansk oblasts. Each city council, district council, and then oblast council will make a decision to stage a referendum, on the status of second state language, etc.
A decision will be made to create, and arm, an army of the SouthEast which will be activated to protect the Russian-speaking population of the SouthEast. A month before the presidential election, Kyiv will have no control over nearly seven million Ukrainian citizens.
Whether the Russians can conduct a similar operation in other areas of the south-east is an open question, but the likelihood of such a scenario is more than high.
The main objective of the Russian Federation is not clear. The separatists are demanding a referendum on accession to Moscow - but such a referendum is not required by Moscow because it could go against them in all regions except the Luhansk [as indicated by latest OP's LEvko].
Obviously, the Russians are betting on another scenario - on a controlled civil war. The big question is along which line do they want to form a cordon.
They need a local conflict in which right-wing radicals fight with the Russian population. Thus Russia will be able to continue to broadcast this image of events to its own viewers.
The second important question - is Kyiv is ready for such a war? Apparently not. This means only one thing - the legitimacy of government in the capital will be drastically reduced with every seizure of yet another police headquarters building.
The second task of the Kremlin is to render Kyiv authorities semi-legitimate from the point of view of most Kievans and residents of pro-Ukraine areas; ideally to get Kyiv authorities to resign under the pressure of "Right sector".
In yesterday's statements by the Russia's Minister of Finance, Siluanov, he specifically expressed the view that Ukraine should be offered money in exchange for recognition of the annexation of the Crimea. Simply put, the Russian's position on the eve of the four party meeting (between Kerry, Ashton, Lavrov, and Deshchitsa) can be boiled down to this: they are willing to back down, but in Ukraine must recognize the annexation of Crimea, and the EU must abandon sanctions.
Current events in the Donbas indicate Russia is raising the stakes. The EU clearly understands what a nightmare the flow of refugees from a pseudo-civil war (actually a Ukraine-Russia war) at the borders of the EU would be. There is no doubt that if the EU and the U.S. refuse to compromise, the Russians will continue to expand the boundaries of the separatist entities. By extending these formations, they are driving the Ukrainian economy into a dead end.
Now everything depends on the determination of the Ukrainian government, which at the moment, does not exist.