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(Bloomberg) -- Vladimir Putin is playing for keeps in Ukraine and he might bankrupt the country to get what he wants.

As fighting flares anew in the 10-month-old conflict and the death toll mounts, thats the assessment of analysts in Ukraine and New York, as well as Moscow.

While Kremlin-backed rebels pressure the Ukrainian government, the U.S. and the European Union contemplate tightening economic sanctions on Russia. Putin, however, seems emboldened in his belief that this is a showdown he must not and will not lose.

Putin realized that he will never be in the Wests good graces and this makes him act more decisively, Igor Bunin, the director of the Center for Political Technologies in Moscow, with ties to the Kremlin, said by phone Tuesday. He started playing all in.

A September cease-fire between the Ukrainian government and pro-Russian separatists, which helped stem the violence, crumbled this month. The death toll surged above 5,000 as rockets hit a residential area in Mariupol and grenade fire blew out a trolleybus in Donetsk.

For Putin, maintaining Russian influence in Ukraine and preventing it from allying with his countrys Cold War-era foes in the EU and NATO is crucial and is the driving force behind his support for the rebels.

Fighting erupted after the foreign ministers of Germany, France, Russia and Ukraine failed to make progress at a Jan. 12 meeting in Berlin and canceled plans for a leaders summit. EU foreign ministers will meet Thursday to make a decision on tightening sanctions.

Joerg Forbrig, a senior program director at the German Marshall Fund in Berlin, said that since previous talk of reducing sanctions has fallen away, Putin is back on the attack and may be trying to show that sanctions are counterproductive.

Ukraine, the U.S. and its allies say Russia supports the rebels with hardware, cash and thousands of troops. The Kremlin says the government in Kiev is waging war against its own citizens, especially Russian speakers, who make up the majority of the populations of the Donetsk and Luhansk regions.

There are signs that the conflict may derail Ukraines push for another $15 billion in aid. The government last week requested a four-year aid package. Christine Lagarde, managing director of the International Monetary Fund, told President Petro Poroshenko that she was ready to support a pact, but said in an interview the French newspaper Le Monde published on Jan. 26 that Ukraine must have stability at its frontiers for any hopes of economic recovery.

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Putin Goes All In as Ukraine Fights for Funding to Avert Default