US President Barack Obama has said he doesn't hope that Kremlin will change its course towards Ukraine without economic pressure of the West.

President Obama on Wednesday accused Russian President Vladimir Putin of "scaring the heck out his neighbors" by taking a nationalist, outdated approach to international relations.

Obama, in extensive remarks to the Business Roundtable, said his Russian counterpart is unlikely to shift his stance on Ukraine until the full force of economic sanctions leveled against Moscow hits home and until he felt more domestic political pressure.

"If you asked me, am I optimistic that Putin suddenly changes his mindset, I don't think that will happen until the politics inside of Russia catch up to what's happening in the economy inside economy inside of Russia, which is part of the reason why we're going to continue to maintain that pressure," Obama added.

Obama insisted that Western sanctions against Russia in response to Putin's actions in Ukraine had damaged the Russian economy.

"We continue to offer them [Russian authorities] a pathway to a diplomatic resolution of the problem. But the challenge is this is working for him politically inside of Russia, even though it is isolating Russia completely internationally," Obama said.