Russia, accusing Belarus of stealing oil from a major pipeline, has shut off oil exports to its western neighbour, halting supplies to Poland and Germany and threatening wider disruptions in central Europe.
Russia's pipeline monopoly Transneft said today it was forced to act because Minsk had been siphoning off oil illegally from the Druzhba ('Friendship') pipeline system.
Workers talk at Hungarian oil group MOL's main Danube refinery. Oil and gasgroup MOL said if Russian oil shipments via Belarus do not restart soon, it expects its pipeline to dry up today.
The oil supply cut was reminiscent of a stand-off last year between Russia and Ukraine that hit gas supplies to Europe. It escalates a tit-for-tat dispute between Russia and longtime ally Belarus, who have imposed punitive oil levies on each other.
The European Union demanded an "urgent and detailed" explanation, a spokesman for Energy Commissioner Andris Piebalgs said. Europe is heavily reliant on energy powerhouse Russia for its oil and gas and extremely vulnerable to Russian supply cuts.
"The Belarussian side began taking transit oil as payment in kind for a new duty it had illegally imposed," Transneft Vice-President Sergei Grigoryev said.
"We therefore reduced transit supplies, equal to the amount being taken. We then reached the point where we had to stop supplies completely."
Belarus had until recently served as a loyal client state of Russia, and the two countries have discussed launching a common currency as a precursor to creating a political union.
But Moscow's recent decisions to impose duties on oil sales to its neighbour, double gas prices and ban sugar imports have led President Alexander Lukashenko to turn against his patron, Kremlin chief Vladimir Putin.
Mr Lukashenko last week slapped a $45 per tonne transit fee on Russian oil pumped via Belarus.
Russian Deputy Economy Minister Andrei Sharonov said he saw little chance of a de-escalation. "It looks like we are heading into a trade war," he told Ekho Moskvy radio. Sharonov ruled out talks unless Belarus scraps its transit fee first.
Poland, which is served by the northern branch of the Druzhba pipeline, reported oil shipments had stopped overnight. Europe's biggest economy Germany later confirmed refineries in its ex-communist east were also cut off.
Druzhba forks on Belarussian territory, and countries served by its southern spur - including Hungary and Slovakia - said they expected their supplies to dry up today.
Belarus said it was not to blame for the supply cut.
Russia is the world's second-largest oil exporter after Saudi Arabia. Around 1.8 million barrels per day of Urals crude flow via the Druzhba pipeline system, built in the 1960s to tie communist eastern Europe to Soviet energy supplies.
Transneft head Semyon Vainshtok was quoted earlier by Russian news agencies as saying that the pipeline operator was doing all it could to reroute supplies to European customers.