Russian President Vladimir Putin has called on pro-Moscow separatists in Ukraine to open a "humanitarian corridor" to allow Ukrainian troops to escape from the rebel-held eastern town of Novoazovsk.

"I call on the rebel forces to open a humanitarian corridor for the Ukrainian troops who are surrounded, so as to avoid unnecessary casualties and to give them the opportunity to withdraw from the zone of operations," Putin said in a statement issued overnight Thursday.

Italy's Prime Minister Matteo Renzi, whose country currently holds the rotating presidency of the EU, called Russian President Vladimir Putin on Thursday to warn of "very serious consequences" after reports that Moscow had sent troops into Ukraine.

The premier said the "entry of Russian troops into Ukraine" is "an intolerable escalation which will lead to very serious consequences".

Rebels in east Ukraine appeared on Wednesday to have seized swathes of territory from government forces who abandoned vehicles and ammunition as they retreated, while Western intelligence said Russian army units were operating inside the country.

After weeks of successful military operations that have seen government forces push deep into the last rebel bastions, the tide appears to be turning once again in the four-month conflict, prompting a nervous government in Kiev to call on NATO for help.

The presidents of Russia and Ukraine on Tuesday sat down to crunch one-on-one talks over heavy fighting in east Ukraine as the Kremlin admitted for the first time its troops had entered its neighbor's territory.

Ukrainian President Petro Poroshenko and Russian leader Vladimir Putin began a key bilateral meeting after six hours of difficult negotiations alongside top EU officials in Minsk aimed at defusing a crisis some fear could lead to all-out war between Kiev and Moscow.

The presidents of Russia and Ukraine hold key talks Tuesday with little hopes for a breakthrough in resolving the raging conflict pitting Kiev against pro-Moscow separatist rebels.

Hours before the crunch talks, Kiev ratcheted up tensions by releasing footage purporting to show 10 Russian soldiers captured on its territory who a Moscow military source claimed had crossed into Ukraine "by accident."

A Moscow court on Monday jailed three activists for up to three-and-a-half years as it wrapped up an explosive two-year trial that put 13 behind bars for protests over Vladimir Putin's presidential return.

The May 2012 clashes between protesters and police spelled a bloody end to months of unprecedented street discontent with Putin's decision to swap his prime minister's seat with then-president Dmitry Medvedev and extend his dominance over Russia by at least six more years.

President Vladimir Putin said on Thursday that Russia should not "fence itself off from the outside world" despite a plunge in East-West relations over the pro-Kremlin insurgency in Ukraine.

Putin added during a visit to Crimea -- seized by Russia from Ukraine in March -- that an ongoing trade war with the United States and Europe did not mean Moscow "should break ties with partners. But we should also not let them treat us with disdain."

NATO chief Anders Fogh Rasmussen expressed concern on Wednesday that Russian President Vladimir Putin's ambition went "beyond Ukraine," where he is accused of stoking a bloody rebellion by pro-Kremlin separatists.

Russian President Vladimir Putin on Tuesday hosted his Egyptian counterpart Abdel Fattah al-Sisi for talks about Cairo's purchase of advanced surface-to-air missiles and membership in a Moscow-led free trade zone.

The two strong-willed leaders have developed a close working relationship since Putin gave his backing to Sisi's presidential run during the latter's visit to Moscow in February.

A convoy of 262 Russian trucks rolled toward the Ukrainian border on Tuesday as Kiev vowed to block the aid mission from its territory over fears it was a ploy to bolster pro-Kremlin rebels.

The convoy of what Russia says is humanitarian aid has sparked fears of an escalation in a conflict that has left hundreds dead in eastern Ukraine in recent months and plunged Moscow's ties with the West to their lowest point in decades.