Two of the most senior rebels in eastern Ukraine have quit, deepening the disarray in a pro-Moscow separatist movement being pushed back by an Ukrainian military offensive.

The downing of the Malaysian jet MH17 could have a transformative impact on the crisis in the Ukraine, massively increasing pressure on Russian President Vladimir Putin over his support for anti-government rebels, experts have said.

Pro-Russian insurgents dug in across eastern Ukraine, fortifying their positions around seized buildings and erecting fresh barricades even as Ukrainian tanks took up positions outside one eastern city now controlled by armed men.