Australia would enact strong economic sanctions against Russia should it invade Ukraine, Trade Minister Dan Tehan has warned.
As tensions in the region heighten, Australian diplomatic staff have been evacuated from the Ukrainian embassy in Kyiv.
It comes after the United States warned a Russian invasion of Ukraine would be imminent.
Mr Tehan said he hoped the situation in Ukraine would resolve peacefully, but measures would be enacted should Russia invade.
"It is highly likely there would be very strong sanctions against Russia and we'll have to play our part in that regard," he told Sky News.
"We want a de-escalation, but if (invasion) happens, then you'll be looking at sanctions and we'll be a part of that."
Mr Tehan said an invasion would also likely lead to an increase in oil and gas prices and put pressure on international markets.
Treasurer Josh Frydenberg said the situation in Ukraine had reached a "dangerous juncture".
"It's a very dangerous situation and the reverberations will be felt far and wide if, in fact, the Russians do invade," Mr Frydenberg told the Nine Network.
"You don't amass more than 100,000 troops on a border to check out the views or have a picnic."
Australian diplomatic staff have been directed to a temporary office in Lviv.
Soldiers work with their military vehicle at the during the Union Courage-2022 Russia-Belarus military drills in Belarus, a country that neighbours Ukraine. Source: BelTA
Labor deputy leader Richard Marles said the situation in Ukraine was concerning.
"We very much respect its territorial integrity, its sovereignty - Russia should do the same," he told ABC TV.
"We're particularly mindful of the Ukrainian Australian community, who are feeling it particularly tough at the moment."
The federal government has been warning Australians in Ukraine to leave immediately in light of the situation.
Former US ambassador to Ukraine Steven Pifer said there had been a "startling build-up" of Russian forces on the Ukrainian border.
"Washington has made a decision to assume the worst and then try and do everything it can to deter and dissuade the Kremlin from making a decision that would be a tragedy for Ukraine, but also a tragedy for Russia," he told ABC radio.
"Ideally, at the end of the day, (Russia) decides not to attack and pursue some diplomatic routes, but they have multiple military options."
US President Joe Biden and Russian President Vladimir Putin held crisis talks on Ukraine on Sunday.
Russia was warned during the meeting there would be "swift and severe costs" should an invasion happen.
