Amid a flurry of diplomatic activity, the situation in eastern Ukraine is deteriorating rapidly, with reports of street-to-street fighting in Luhansk and the continuing bombardment of Donetsk by government forces.

A series of meetings are underway supposedly aimed at finding a “road map” to end the civil war in Ukraine and “normalise” relations between Kiev and Moscow.

Talks in Berlin Sunday evening between the Foreign Ministers of Germany, Ukraine, France and Russia were followed by pledges to continue discussions. The day before, Finland’s President Sauli Niinisto became the first European Union (EU) leader to travel to Russia since February—when President Viktor Yanukovych was deposed in a right-wing coup backed by the Western powers.

Since then, months of feverish anti-Russian propaganda have been aimed at legitimising the military encirclement of the country by NATO. This was ratcheted up following with the crash of Malaysia flight MH17 in eastern Ukraine on July 17, with the loss of 298 passengers and crew. The US and European powers blamed Moscow-backed rebels for shooting down the craft, but more than six weeks on they have still to provide any evidence for their claims.

Last Thursday, unverified reports of a clash between Russian and Ukrainian military forces saw sharp declines on the stock markets, amid fear that a global conflagration was imminent. Speaking ahead of Sunday’s talks, Germany’s Frank-Walter Steinmeier warned that “we continue to slide into a direct confrontation between Russian and Ukrainian combat forces.”

However, nothing concrete appears to have come out of the discussions, other than an agreement that the humanitarian aid convoy that left Moscow last week would be allowed to travel to eastern Ukraine. But even this is by no means certain. The head of the International Red Cross (IRC), Lorban Korba, was due in Moscow for talks on the status of the 270 trucks, containing food and other supplies that have been stuck on the border for almost one week. It had been agreed that Ukrainian and Russian officials would make joint inspections of the trucks, and that IRC workers would travel in them to eastern Ukraine, but the IRC says it has not received the necessary guarantees of security for its personnel and so cannot move.

The United Nations Under-Secretary General for Political Affairs Jeffrey Feltman is to travel to Kiev this week, as is the United Nations Under-Secretary General for Humanitarian Affairs. They are to hold talks towards a “peaceful settlement” in eastern Ukraine. The discussions were endorsed by Russia’s Ambassador to the UN, Vitaly Churkin.

Yesterday it was confirmed that German Chancellor Angela Merkel will go to Kiev on Saturday for talks with President Petro Poroshenko and Prime Minister Arseniy Yatsenyuk. Ukraine’s Foreign Minister Pavlo Klimkin said that the visit was an expression of the “chancellor’s personal support. This is an expression of Germany’s support as the key EU country…”

Insisting that Kiev authorities had set a “red line” on negotiations with Moscow, Klimkin said there could be no peace without agreement that “Ukraine is and should remain a unitary, democratic and European state and second, Ukraine should follow a European course…”

Klimkin earlier called on German radio for NATO and the EU to supply military aid to Kiev. The appeal was denounced by Russian Foreign Minister Sergei Lavrov, who said it would contradict “all the agreements, all the understandings that were reached on the needed ceasefire and the beginning of negotiations…”

Finland’s Prime Minister Alexander Stubb stated that aid from NATO was not possible as it “provides military assistance to its members,” and “the EU doesn’t have the capacity to provide this kind of support.”

Speaking in Latvia on Monday, Merkel stressed German support for “enhanced preparations” to deploy NATO into the region so as to reassure its Baltic allies, but publicly ruled out the open arming of Kiev. Responding to US-led demands for the establishment of permanent NATO bases in Europe, she said this would violate the 1997 cooperation agreement between the alliance and the Russian Federation.

Germany played a leading role in destabilising Ukraine and sections of its media are vociferous in demanding strong action, including military threats, against Russia. However, the country has been badly hit as a result of punitive sanctions imposed by the EU.

The Bundesbank warned Monday that global tensions, such as the crisis in Ukraine, were putting “earlier assumptions about the strength of the country’s growth at risk.” The economy contracted by 0.2 percent in the second quarter, further dragging down any hope for growth in the euro zone. The “industrial economy will be especially hard hit by the disruptive external factors,” the bank said.

The EU has had to agree to pay farmers to destroy products hit by Moscow’s retaliatory sanctions on food products. Eastern Europe, Greece and Italy have been especially hit.

Merkel’s comments were made the same day that NATO General Secretary Anders Fogh Rasmussen and General Phillip Breedlove, NATO’s supreme allied commander for Europe, co-authored an op-ed in the Wall Street Journal in which they demanded the upcoming NATO summit in Wales on September 4-5 prepare for war with Russia. NATO forces must be stationed in Eastern Europe “as long as necessary” they wrote, with “ upgraded intelligence gathering and sharing; updated defense plans; and an expanded training schedule with more exercises, of more types, in more places, more often.”

Calling for a massive increase in military spending, the two said NATO’s rapid-reaction capability must be upgraded so it can be deployed “more quickly and … at the first sign of trouble…”

President Barack Obama is to visit Estonia next week, in the lead-up to the NATO summit. Talks between the leaders of Estonia, Latvia and Lithuania will centre on reaffirming “our ironclad commitment” to the mutual defence of NATO and its allies, a White House spokesperson said.

For its part, Russia’s energies are directed at trying to exploit any difference between Europe and the US in the hope that this will somehow neutralise Western machinations.

Anatoly Adamishin, president of the Euro-Atlantic Cooperation Association and former Russian first deputy foreign minister, told ITAR-TASS that the US played the “decisive role” in the Ukrainian crisis. Consequently, it was not the Ukrainian authorities “but the Obama administration pushing Kiev to settle the conflict in south-east Ukraine by force which will finally answer this question.”

Adamishin made an appeal to the US to change course, stating, “At present, when a menacing threat for the whole world is ripening in the Middle East, the US position supporting a military operation in east Ukraine may change. If Americans are reasonable people they should get a free hand to fight Al Qaeda and not seek to kindle a fire in Ukraine.”

On Tuesday, it was announced that the Parliamentary Assembly of the Council of Europe (PACE) had agreed to invite Russia to its presidential committee session in Paris on September 1-2. PACE removed Russia from its leading posts in April.

In the meantime, the population of eastern Ukraine continues to suffer. Fifteen bodies have so far been recovered from the convoy of dozens of men, women and children destroyed on Monday in a missile strike near Luhansk. Ukrainian forces and pro-Russian separatists have blamed each other for the attack.

A Ukrainian government spokesman stated that its military were engaged in fierce fighting in Luhansk and were recapturing the city “block by block.”

Government forces have launched massive air strikes on industrial enterprises, including mining operations, metallurgical and chemical plants. Residential areas in Luhansk and Donetsk continue to be shelled, knocking out freshwater and electricity supplies. Amid food shortages, tens of thousands have fled, including 22,000 people in just five-days last week. More than 2,000 people have been killed, and thousands injured, a casualty rate of 60 people per day.