U.N. Secretary General Ban Ki-moon on Friday expressed grave concerns about the intensifying conflict in Ukraine after Kiev and the West said Russian troops were actively involved in fighting in the country's east.

Sitting beside a trench, the smoke of nearby combat visible, "Batya" looks towards the besieged town of Ilovaysk and considers the options of the pro-Kiev fighters there battling for survival.

The United States warned Thursday it was considering new sanctions against Russia over its involvement in the latest fighting in Ukraine.

"We have additional tools and sanctions that we can certainly choose to put in place," State Department spokeswoman Jen Psaki said, who said those options would be discussed with NATO allies.

U.N. Secretary General Ban Ki-moon is alarmed by reports of fighting in east Ukraine spreading southward and warned of a dangerous escalation, his spokesman said Thursday.

The United Nations is unable to confirm reports that hundreds of Russian troops had crossed into Ukraine to shore up pro-Moscow rebels, the spokesman added.

U.S. Army troops equipped with tanks will head to Eastern Europe soon to reassure NATO allies anxious over Russia's intervention in Ukraine, Pentagon officials said Thursday.

About 600 troops from the 1st Brigade, 1st Cavalry Division are due to deploy in October to Poland and the Baltic states for training exercises with alliance members, replacing paratroopers from the 173rd Airborne Brigade, said spokeswoman Lieutenant Colonel Vanessa Hillman.

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".

Shelling in Ukraine's rebel-controlled city Donetsk has killed 15 since midday Thursday, local authorities said, describing the situation as "extremely tense."

Artillery fire in districts to the west, north, and northeast of the center destroyed infrastructure, including residential houses, the city hall said.

Ukraine's ambassador to the OSCE accused Russia Thursday of a "direct invasion" but Moscow's envoy denied reports that Russian troops were active in the conflict-torn east of the country.

"We registered a direct invasion by the Russian military into the eastern regions of Ukraine," Kiev's envoy Ihor Prokopchuk told journalists following a special meeting of the European security body to discuss the latest developments in Ukraine.

A leading volunteer commander in Ukraine triggered protests against the government on Wednesday after a series of angry Facebook messages over the failure to support troops besieged by rebels and rapidly running out of ammunition.

Pro-Russian rebels have surrounded the town of Ilovaysk, a railway hub 10 kilometers (six miles) east of their main stronghold of Donetsk.

Switzerland on Wednesday added 11 names and five banks to its blacklist over the Ukraine crisis in fresh moves to stop the country from being used to avoid EU sanctions against Russia.

The government in a statement said it had taken "all the measures required to ensure that the most recent sanctions imposed by the European Union cannot be circumvented via Swiss territory".