SLAVYANSK, Ukraine - Ukraine’s acting president accused Russia on Sunday of waging war in his country’s separatist eastern rust belt and declared the launch of a “full-scale anti-terrorist operation” that left at least two dead.

The clashes broke out a day after masked gunmen stormed a series of police and security service buildings in coordinated raids that Washington’s UN envoy Samantha Power said on Sunday bore “tell-tale signs of Moscow’s involvement”.

The heavily Russified region has been riven by unrest since a team of Western-backed leaders rose to power in February on the back of bloody protests against the old regime’s decision to reject an EU alliance and look for future assistance from the Kremlin.

Russia has since massed around 40,000 soldiers along Ukraine’s eastern frontier and threatened to halt its neighbour’s gas supplies over unpaid bills - a cutoff that would impact at least 18 EU nations and potentially lead to further retaliation against the Kremlin.

Saturday’s attacks were especially unsettling for both Kiev and Western leaders because of their remarkable similarity to events leading up to Russia’s annexation of Ukraine’s Crimea peninsula last month. The balaclava-clad gunmen were armed with special-issue assault rifles and scopes most often used by nations’ crack security troops.

Many wore unmarked camouflage uniforms similar to those seen on the highly trained units that seized the Black Sea peninsula in early March. They also moved with military precision and cohesion.

Acting President Oleksandr Turchynov told the nation in a televised address that “we will not allow Russia to repeat the Crimean scenario in the east of Ukraine”. “Blood has been spilt in a war that is being waged against Ukraine by Russia,” said Turchynov. “The national security and defence council has decided to launch a full-scale anti-terrorist operation involving the armed forces of Ukraine.”

But Moscow denied any involvement and warned Kiev that the use of force against pro-Russian protesters could ruin the chances of the two sides sitting down for US-EU mediated talks in Geneva on Thursday. Ukraine’s Interior Minister Arsen Avakov announced the launch of a counterstrike against the armed separatists in the eastern Donetsk region early on Sunday morning.

He said crack units from Ukraine’s SBU security service moved first into the city of Slavyansk to regain control of a police station that had been seized by about 20 militants on Saturday. But Avakov admitted that his troops had to “regroup” after meeting stiff resistance and suffering casualties.

“There are dead and wounded on both sides. On our side - an SBU officer. The head of the SBU’s anti-terrorist centre has been wounded, as have four others,” Avakov wrote on his Facebook page. “On side of the separatists - an unidentified number. The separatists have started to protect themselves using human shields.” Russia’s state-run RIA Novosti news agency cited one local protester as saying that a civilian had also been killed and two others injured.

The local administration separately reported a series of heavy clashes on a highway linking Slavyansk with the region’s capital Donetsk to the south.

The Donetsk adminstration said one person was killed and four wounded in an “ongoing armed standoff” on a stretch of the road connecting Slavyansk and the town of Artemivsk. The statement added that authorities were still checking to see “whose side the casualties were on”.

Slavyansk residents meanwhile reported a run on stores and general panic among locals in the poor mining town of 100,000 people. “By nine in the morning, the stores had run out of bread,” 47-year-old Yelena told AFP as attack helicopters hovered overhead. “Everyone is in panic. People are waiting for a war to break out.”

Saturday’s raids drew expressions of grave concern from world leaders and Russian warnings against any use of force against the militants.

The US State Department said John Kerry phoned his Russian counterpart Sergei Lavrov on Saturday to make “clear that if Russia did not take steps to deescalate in eastern Ukraine and move its troops back from Ukraine’s border, there would be additional consequences”.

EU foreign policy chief Catherine Ashton said she was “gravely concerned” and urged Russia to pull back its troops from the border and to “cease any further actions aimed at destabilising Ukraine”.

Britain’s Foreign Office on Sunday said the wave of occupations of government buildings was “a dangerous escalation”.

“Assumptions that Russia is complicit are inevitable as long as Moscow does not publicly distance itself from these latest lawless actions.

And NATO chief Anders Fogh Rasmussen agreed that the “reappearance of men with specialised Russian weapons and identical uniforms without insignia, as previously worn by Russian troops during Russia’s illegal and illegitimate seizure of Crimea, is a grave development”.

But Russia’s Lavrov warned that the Geneva talks could be cancelled if Kiev used force against “residents of the southeast driven to despair”.

The latest wave of unrest began last weekend when protesters seized the seat of government in Donetsk after similar actions in the eastern cities of Lugansk and Kharkiv.

The Donetsk protesters heavily fortified the building and announced the independence of the “Donetsk People’s Republic” - the flag of which has gone up over newly seized security buildings across the region.

But many of the pro-Russian protests have only drawn crowds of a few hundred and local polls showed the majority of citizens in the Russian-speaking east preferred to remain part of Ukraine.