Britain is on the brink of a diplomatic crisis with Russia which could see the expulsion of several diplomats from London and tit-for-tat reprisals by Moscow.
The British government is preparing to send a strong signal to the Kremlin following its refusal to extradite Andrei Lugovoi, the former KGB agent suspected of murdering Alexander Litvinenko last November.
On Monday, Russian prosecutors formally announced that Lugovoi would not be handed over to the UK, on the grounds that the Russian Constitution prevents his extradition.
The government was considering on Wednesday evening countermeasures to show Britain's extreme displeasure at the Kremlin's decision and the seriousness with which it takes the "terrible" murder of Litvinenko -- a British citizen and fierce critic of Russian President Vladimir Putin.
The options include the possible expulsion of Russian diplomats from the London embassy and the withdrawal of cooperation in several areas, including education, trade, social affairs and counterterrorism.
A spokesman for Russia's foreign ministry, Mikhail Kamynin, warned on Wednesday that London was in danger of jeopardizing its relationship with Moscow.
"I don't understand the position of the British government. It is prepared to sacrifice our relations in trade and education for the sake of one man," he said, adding: "Our position is clearly in line with Russia's constitution and legislation."
British officials say that Foreign Secretary David Miliband is weighing the options. He will not announce a decision before next week, when the Foreign Office is expected to present a report to parliament setting out the punitive steps Britain will take. Foreign Office officials are bracing themselves for immediate and furious reprisals from Moscow, which could include the tit-for-tat expulsion of UK diplomats.
Meanwhile, nearly all major Russian dailies gave front-page coverage to the row over Moscow's refusal to extradite Lugovoi, saying the clash with London was sliding into full-scale conflict.
"The already months-old squabble between Russia and Britain over the Litvinenko affair has turned into a full-scale diplomatic conflict," the daily Kommersant wrote.
The paper quoted a series of commentators on the likely consequences of retaliatory measures London has said it is considering.
"I hope they will not roll back political and economic relations between us. Otherwise we'll slide into a new cold war," said Yury Kobaladze, a former intelligence officer in Britain.
The pro-government daily Izvestia said Britain's harsh rhetoric in the row was an attempt by newly appointed British Prime Minister Gordon Brown to appear strong.
"Does Brown really have no enemy scarier than Russia? It's as though it were Russians blowing up London buses and metro cars, planning terrorist acts at airports," Izvestia said.