Ukraine's new president Petro Poroshenko said his country would never give up Crimea and would not compromise on its course towards closer ties with Europe, spelling out a combative and defiant message to Russia in his inaugural speech on Saturday.

The 48-year-old billionaire took the oath of office before parliament, buoyed by Western support but facing an immediate crisis in relations with Russia as a separatist uprising seethes in the east of his country.

Russia annexed the Crimean peninsula in March, weeks after street protests ousted Poroshenko's pro-Moscow predecessor, Viktor Yanukovich, in a move that has provoked the deepest crisis in relations with the West since the Cold War.

Citizens of Ukraine will never enjoy the beauty of peace unless we settle our relations with Russia. Russia occupied Crimea, which was, is, and will be Ukrainian soil," Poroshenko said in a speech that drew a standing ovation.

He had told this to Russia's Vladimir Putin when the two met on Friday at a World War Two anniversary ceremony in France, he said.

Poroshenko, who earned his fortune as a confectionery entrepreneur and is known locally as the "Chocolate King", said he intended very soon to sign the economic part of an association agreement with the European Union, as a first step towards full membership.

This idea is anathema to Moscow, which wants to keep Ukraine in its own post-Soviet sphere of influence.

His voice swelling with emotion, Poroshenko stressed the need for a united Ukraine and the importance of ending the conflict that threatens to further split the country of 45 million people. He said it would not become a looser federalized state, as advocated by Russia.

"There can be no trade-off about Crimea and about the European choice and about the governmental system. All other things can be negotiated and discussed at the negotiation table. Any attempts at internal or external enslavement of Ukraine will meet with resolute resistance," Poroshenko said.

Poroshenko, Ukraine's fifth president since independence, won a landslide election on May 25 after promising to bridge the east-west divide that has split the country and thrust it into a battle for its survival.

Ukrainians hope the election of Poroshenko, who is married with four children, will bring an end to the most tumultuous period in their post-Soviet history.

More than 100 people were shot dead by police in Kiev by police in the street protests that eventually brought Yanukovich down and in the east, scores of people, including separatist fighters and government forces have been killed in fighting since April.

The uprising in the east is not the only challenge facing Poroshenko, who inherits a country on the verge of bankruptcy, still dependent on Russia for natural gas and rated by watchdogs as one of the most corrupt and ill-governed states in Europe.

The forceful speech by Poroshenko, who served as foreign minister and minister for economic development in previous administrations, drew an ovation from guests and VIPs who included Lithuanian President Dalia Grybauskaite, U.S. Vice-President Joe Biden and senior EU officials.

Cheering crowds later greeted him on a walk in blazing sunshine on the square in front of Kiev's St Sophia's Cathedral, which was decked out with the blue and yellow national flags.