Moscow is considering "targeted retaliatory strikes" against Ukraine after a shell reportedly crossed into Russian territory and killed a civilian, Russian media outlets reported on Monday.

Moscow said Sunday that a Ukrainian shell landed in a Russian border town, killing a civilian and wounding two others, prompting the Russian foreign ministry to warn that the incident was "another act of aggression" that could have "irreversible consequences".

The daily Kommersant quoted a Kremlin source as saying that Moscow was considering "targeted retaliatory strikes" on targets in Ukraine, adding that Russia "knows exactly where they (the Ukrainians) are firing from".

"Our patience is not limitless," the source added.

Several shells reportedly landed early Sunday in the small Russian border town of Donetsk, which shares the same name as the larger rebel stronghold city in east Ukraine that declared itself the Donetsk People's Republic in April.

Russia is reportedly not considering any large-scale action, but only targeted strikes on positions from which fire is being directed at Russian territory.

"We need to use targeted weapons, like Israel does among others, to destroy those who launched this mine," said the deputy speaker of Russia's upper house of parliament, Yevgeny Bushmin, on Sunday.

Although both sides have reported cross-border shootings in the past, it appears to be the first time during the conflict with Ukraine that Moscow has reported a fatality on its side of the border.

Ukraine quickly denied the claims, saying that its government forces "had never before, are not now, and never will fire on the territory of a neighbouring state".

Kiev called the accusation that its forces had fired across the border "total nonsense" and suggested the attack could have been the work of pro-Moscow rebels trying to provoke Russia to intervene against Ukraine on their behalf.

Combat inside Ukraine has intensified dramatically since a rebel missile attack killed at least 19 government troops and wounded nearly 100 others on Friday.

Russia's Interfax news agency reported fierce fighting on the outskirts of Luhansk, near the border with Russia, but there was no confirmation of claims that Kiev has massed tanks on the outskirts of the city.

The office of Ukraine's President Petro Poroshenko said Monday that Ukrainian forces, backed by warplanes, had broken through rebel lines surrounding Luhansk airport, ending a separatist blockade of the airfield.

The industrial hub of some 425,000 people is one of two rebel self-declared "people's republics" and – along with the city of Donetsk – now finds itself the focus of Kiev's military push to end the three-month-long separatist insurgency.

Local authorities said three people were killed and 14 more were wounded in various incidents around the city over the past 24 hours.

(FRANCE 24 with REUTERS and AFP)