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BERLIN (Reuters) - German Chancellor Angela Merkel criticized Russian plans for a military parade in Crimea on Friday to mark the Soviet Union's victory over Nazi Germany, citing the heightened tensions in Ukraine. There is speculation in Russia that President Vladimir Putin may fly to Crimea to commemorate victory in World War Two after attending a military parade on Moscow's Red Square on Friday. Crimea is also marking 70 years since the Red Army retook the region from the Nazis. Merkel said May 9 was an important date in Russia to commemorate the defeat of Hitler's Nazis but said the current conflict in Ukraine made a parade inappropriate. "I think it is a shame if such a day is used to hold a parade in such an area of conflict," Merkel said at a news conference with Cypriot President Nicos Anastasiades. She also said her government was doing all it could to reach a diplomatic solution to the crisis, saying while the European Union was ready to take further steps against Russia over Ukraine if needed, imposing further sanctions was not an end in itself. A deadly few days in Ukraine have transformed the separatist uprising there into a conflict with hardened positions with little immediate prospect of a peaceful resolution. (Reporting by Andreas Rinke; Additional reporting by Tim Heritage in Moscow; Editing by John Stonestreet)