SLAVYANSK (Ukraine): Ukraine’s military launched assaults to retake rebel-held eastern towns on Thursday in which up to five people were reported killed, a move Russian President Vladimir Putin warned would have “consequences”.

The offensive sent international tensions soaring and oil prices up on the prospect of Russia making good on its threat of a massive response in the ex-Soviet republic.

In Slavyansk, a flashpoint eastern Ukrainian town held by rebels since mid-April, armoured military vehicles drove past an abandoned roadblock in flames to take up position.

Shots were heard as a helicopter flew overhead, and the pro-Kremlin rebels ordered all civilians out of the town hall to take up defensive positions inside.

“During the clashes, up to five terrorists were eliminated,” and three checkpoints destroyed, the interior ministry said in a statement. Regional medical authorities confirmed one death and one person wounded.

Hours later, the armoured vehicles withdrew, leaving the town calm but tense.

The rebels, which the Kiev government and its Western backers believe are controlled and supported by Moscow, have been occupying around 10 towns in Ukraine’s east since mid-April.

An international accord reached in Geneva last week was meant to defuse the crisis, but was swiftly dismissed by the rebels.

A brief truce collapsed over the weekend, prompting Ukraine’s acting President Oleksandr Turchynov to order a resumption of an “anti-terrorist “offensive to flush the militants out.

Also on Thursday, Ukrainian special forces seized back control of the town hall in the southeastern port city of Mariupol with no casualties, Interior Minister Arsen Avakov said. Separatist sources confirmed the loss of the building in the port city, whose population is nearly 500,000.

And an army base in the eastern town of Artemivsk overnight repelled an attack by heavily-armed rebels using machine-guns and grenades, the interior and defence ministries said. One soldier was wounded.

Failure of accord: It was the worst violence to erupt in Ukraine since the signing the Geneva accord a week ago.

Putin called the armed offensive a crime.

“If Kiev has really begun to use the army against the country’s population... that is a very serious crime against its own people,” he said.

He warned of “consequences, including for our intergovernmental relations”.

Russia, which has an estimated 40,000 troops massed on Ukraine’s border, has already threatened to respond as it did when it invaded Georgia in 2008 if it sees its interests in Ukraine attacked.

Shortly after Putin spoke, Russia’s defence ministry announced new military “exercises” near the border in response to the Ukrainian military operations.

US President Barack Obama on Thursday accused Russia of not abiding by the Geneva deal and warned more sanctions could be imposed on Moscow within days.

“We continue to see malicious, armed men taking over buildings, harassing folks who are disagreeing with them, destabilising the region and we haven’t seen Russia step out and discouraging it,” he said Thursday during a trip to Japan.

Russia, though, claims Washington and the Ukrainian government are reneging on their responsibilities, despite Kiev vowing to give an amnesty to the rebels, protect the Russian language and decentralise power.

Geopolitical tensions: While Obama has ruled out sending US or Nato forces into Ukraine, Washington has begun deploying 600 US troops to boost Nato’s defences in nearby eastern European states.

France said it was also sending four fighter jets to Nato air patrols over the Baltics.

Russian Foreign Minister Sergei Lavrov on Thursday accused the United States and the European Union of trying to stage “an operation to unconstitutionally change the regime”.

“They are trying to use Ukraine as a pawn in a geopolitical game,” he said.

The Ukrainian government announced its renewed offensive against the rebels after the body of an abducted local politician who belonged to Turchynov’s party was found weighted down in a river near Slavyansk.

Volodymyr Rybak’s funeral was held Thursday in his home town of Horlivka.

His wife and friends wept before his body, which was covered in flowers, before prayers were said and it was taken for burial.

Ukraine’s acting president said he had been “brutally tortured” and blamed the rebels, while his wife said president had been stabbed multiple times.

The European Union’s top foreign policy official, Catherine Ashton, urged implementation of the Geneva accord, and expressed “grave concern” at the murder of Rybak and other violence.

Russia’s gas supplies to Ukraine — and through it, to Europe — have also become a significant source of tensions.—AFP