The Russian state monopoly, Gazprom, said it had cut supplies to Ukraine by a quarter - the level of Ukraine's imports - on Sunday after Kiev refused to sign a new contract requiring it to pay four times as much for its gas this year than last.
The switch-off already seemed to be making itself felt further west, with deliveries reported down by as much as 18% in Hungary, Poland, Austria and Slovakia.
Western Europe imports a quarter of its gas from Russia and most of that is delivered by pipelines running across Ukraine.
Gazprom said the only gas now being put into pipelines headed for Ukraine was intended for European customers.
But Ukraine's Naftogaz energy company accused Russia of brinkmanship that was jeopardising Europe's supplies. European gas demand is near peak levels because of freezing wintery weather.
"We can see a drop on our grid. Starting at 5pm [local time] there was an 18% mass reduction"
Bettina Gneisz, OMV (Austrian gas company)
Bettina Gneisz, a spokeswoman for Austria's gas company, OMV, was quoted as saying: "We can see a drop on our grid. Starting at 5pm [local time] there was an 18% mass reduction."
The company had earlier said that it did not expect to be affected by the dispute and could withstand several months without disruptions even if gas supplies from the Ukraine fell. Austria draws 59% of its natural gas from Russia.
Slovakia's SPP gas company also said it had registered a drop in gas pressure.
Dana Krsakova, a spokeswoman, said: "Despite a drop in pressure today, the cut in Russian gas supplies to Ukraine should not affect the situation in Slovakia. No SPP clients are threatened for the moment."
Energy ministers of Germany, Italy, France and Austria made a joint appeal to Moscow and Kiev on Sunday to ensure a steady flow of gas despite the stand-off.
EU energy officials confirmed that member states would hold an emergency meeting on 4 January.
Accusations and criticism
Supplies of gas can be reduced
by lowering pipeline pressure
Meanwhile, Gazprom - in its latest statements - accused Ukraine of siphoning off Russian gas designated for European users.
But Yuriy Yekhanurov, the Ukrainian prime minister, denied the allegation, saying: "Today we are not using a single cubic meter of Russian gas."
In a related development, the United States expressed regret over the Russian decision to cut off gas supplies to Ukraine, saying it created "insecurity" in the region's energy sector.
Sean McCormack, the state department spokesman, said in a statement: "Such an abrupt step creates insecurity in the energy sector in the region and raises serious questions about the use of energy to exert political pressure."