Washington - The United States and Europe must "stand up to" Russian aggression and convey to Moscow that it was on a path of international isolation, US Secretary of State Condoleezza Rice said Thursday.

In a speech outlining US policy on Russia following last month's invasion of Georgia and amid rising tension with the West, Rice warned that Russia cannot be allowed to intimidate neighbours and act outside the rules of global affairs.

"We cannot afford to validate the prejudices that some Russian leaders seem to have: that if you pressure free nations enough - if you bully, and threaten, and lash out - they will cave in, and forget, and eventually concede," Rice said.

"The United States and Europe must stand up to this kind of behaviour, and all who champion it," Rice said at a gathering organized by the German Marshall Fund of the United States, an independent think tank.

US-Russian relations have deteriorated in recent years in disputes over US plans to base a missile-defence system in Poland and the Czech Republic, Western backing for Kosovo's independence earlier this year from traditional Russian ally Serbia, and NATO's eastward expansion.

The United States has criticized Russian Prime Minister Vladimir Putin for cracking down on democratic organization and independent media while he served as president, a post he relinquished in May to Dmitry Medvedev.

Rice faulted Russia for using oil and petrol supplies as a "politcal weapon" against European neighbours, unilaterally pulling out from a conventional military treaty on the continent and threatening Warsaw and Prague for hosting the missile-defence bases.

"The picture emerging from this pattern of behaviour is that of a Russia increasingly authoritarian at home and aggressive abroad," Rice said.

Tensions between Russia and the United States and European Union have peaked since the August 7 invasion of Georgia, a US ally with NATO aspirations, over the breakaway regions of South Ossetia and Abkhazia.

The crisis prompted swift condemnations form the United States and Europe and demands that Russia pullout immediately and return to its peacekeeping mission in the disputed provinces. Moscow escalated the crisis by recognizing South Ossetia and Abkhazia as independent states.

Rice said that blame for the conflict lay with Georgia and Moscow, and said the United States cautioned Georgian President Mikhail Saakashvili about retaliating against separatist militants in South Ossetia.

"We warned our Georgian friends that Russia was baiting them, and that taking this bait would only play into Moscow's hands," Rice said.

"But Russia's leaders used this as a pretext to launch what, but all appearances, was a premeditated invasion of its independent neighbour," Rice added.

"Russia's invasion of Georgia has achieved - and will achieve - no enduring strategic objective," Rice said.

Rice also said the United States will not back down from Russia's courting of Western Hemisphere countries like Venezuela, whose socialistic president, Hugo Chavez, has promoted an anti-US agenda in South America.

Chavez has begun purchasing weapons from Moscow and Russian Cold War-era bombers recently arrived in Venezuela for military exercises - a move the irked Washington.

"We are confident that our ties with our neighbours ... will in now way be diminished by a few, aging Blackjack bombers visiting one of Latin America's few autocracies," Rice said.

Rice reiterated the US commitment to inviting Georgia into the NATO alliance despite Russia's objections. She also warned that in addition to isolating their country, Medvedev and Putin were jeopardizing the credibility of Russian businesses and the country's economic future autocratic policies.

"I cannot image that most Russians would ever want to go back to the days, as in Soviet times, when their country stood isolated from Western markets and institutions," Rice said.

The top US diplomat also dismissed suggestions that the United States and Russia were returning to Cold War relations, but warned Russia will not be allowed to undermine insitutions that govern diplomatic and economic affairs and energy markets while reaping the benefits.

"There cannot be one set of rules for Russia Inc," Rice said, before adding: "There is no third way. A 19th century Russia and a 21st century Russia cannot operate in the world side by side."