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Russia's gas supplies to Poland and Bulgaria were halted Wednesday with Moscow's state gas giant Gazprom telling them that supplies would only resume if and when they paid for the gas in Russian rubles. Gas prices in Europe have risen as a result and the euro has fallen against the dollar.

The move comes as tensions remain high between Western allies and Russia after Foreign Minister Sergei Lavrov on Monday said the threat of a nuclear war is very significant and the risks should not be underestimated.

U.S. Defense Secretary Lloyd Austin, who visited Kyiv last weekend, responded to those comments Tuesday, calling the nuclear war rhetoric "very dangerous and unhelpful."

The U.S. also said it plans to send diplomats back to Ukraine as Russia focuses its assault on the eastern and southern parts of the country.

The euro fell below $1.06 for the first time in five years on Wednesday morning amid fears over Europe's energy security and economic growth.

The euro declined to a five-year low of $1.05860 after Russia's state-owned gas giant Gazprom said it had cut gas supplies to Poland and Bulgaria on Wednesday. By mid-morning, the single currency was trading at $1.0614.

Russia's invasion of Ukraine and the continuing war, now in its third month, has dented the euro, which has fallen 3.5% against the dollar since the start of April.

Russia's defense ministry said it struck an arms depot which houses a "large batch of foreign weapons and ammunition supplied by the United States and European countries for Ukrainian troops."

The statement, which the Defense Ministry posted on its Telegram account, said high-precision, long-range sea-based Kalibr missiles hit the depot in the Zaporizhzhia region.

The ministry also said its air force had destroyed 59 Ukrainian military facilities overnight, including four other warehouses with weapons and ammunition.

CNBC was not able to independently confirm Russia's claim. Moscow has warned Western nations against continuing to supply Ukraine with weapons, saying such supplies are legitimate targets.

Natural gas prices are surging in Europe after Russia halted supplies to Poland and Bulgaria on Wednesday.

The Dutch wholesale gas contract for the day-ahead, a benchmark for Europe, rose 24.2% this morning to 115.75 euros per megawatt hour, while the U.K. natural gas price for June rose around 20 pence to 222 pence a therm.

Early Wednesday morning, Gazprom released a statement saying it had halted supplies to both Poland and Bulgaria — both heavy consumers of Russian gas — due to payments not being made in the Russian currency. It said supplies would resume once these payments were made.

The move also coincides with a sharp rise in tensions between Western allies and Russia as the war in Ukraine continues into a third month.

Russia's gas supplies to Poland and Bulgaria have been halted on Wednesday morning after the countries refused Moscow's demand to pay for gas supplies in rubles.

Russia's state gas giant Gazprom had contacted Poland and Bulgaria's state gas companies on Tuesday telling them that their supplies would be halted on Wednesday. Poland said its supplies had been cut today, while the situation in Bulgaria is more uncertain.

Poland's state-owned oil and gas company PGNiG said Russia's gas giant Gazprom had informed it on Tuesday that it would halt gas supplies that are delivered via the Yamal pipeline on Wednesday morning.

PGNiG said in a statement Tuesday that the company is monitoring the situation "and is prepared for various scenarios" and to receive gas from other sources, but said that currently it has enough gas in storage and is meeting demand.

The halting of gas supplies to Poland, which imports around 45% of its natural gas from Russia, according to recent data from the EU, is another sign of rising tensions between Russia and the West following the invasion of Ukraine. One official in Kyiv described Russia's latest move to cut supplies as "gas blackmail."

Bulgaria imported almost 73% of its natural gas from Russia in 2020, EU data shows.

Russia had demanded that countries importing its gas (the EU as a bloc imports around 40% of its natural gas from Russia every year) must pay in rubles, prompting a backlash from importers, including Poland and Bulgaria, which refused and said the demand is a breach of contract.

Secretary of State Antony Blinken said that he believes Russians are feeling the effect of multiple rounds of coordinated global sanctions for the Kremlin's war in Ukraine.

"I think what we're seeing is that people increasingly in Russia are feeling the effects of the disastrous decision by Putin to attack Ukraine," Blinken said during testimony before the Senate Committee on Foreign Relations.

"For example, upwards of 600 companies have left Russia, including many of the major consumer brands that we all know and are familiar with," he said, adding, "They can't buy the things they've been used to buying for the last almost 30 years."

The nation's top diplomat said that the gains of the last 20 years are being erased and Moscow's ability to modernize key sectors of its economy is slowing. Despite all of that, Blinken said that he believes Russian President Vladimir Putin still holds large support from his citizens, largely due to disinformation campaigns.

"For now, I think what we're seeing is Russian people to the extent that they're informed continue to support for the most part President Putin," Blinken added.

In the weeks since Russia's invasion of its ex-Soviet neighbor, Washington and its allies have imposed rounds of coordinated sanctions vaulting Russia past Iran and North Korea as the world's most-sanctioned country.

Secretary of State Antony Blinken told lawmakers that the U.S. is sending its diplomats back to Ukraine this week.

The nation's top diplomat added that the State Department is also working on plans to reopen its embassy in Kyiv.

"We are sending diplomats back to Ukraine this week and they will begin to assess how we can most effectively and securely reopen the embassy in Kyiv. And without going into too much detail in this setting, I anticipate that we will be in Lviv and then head to Kyiv subject to the president's final decision," Blinken said during testimony before the Senate Committee on Foreign Relations.

"We want to have our embassy reopened and we're working to do that," he added.

On Monday, President Joe Biden announced his plan to nominate Bridget Brink to serve as the U.S. ambassador to Ukraine. Brink, a career diplomat, is currently the U.S. ambassador to the Slovak Republic.

U.S. Secretary of Defense Lloyd Austin called Russia's recent rhetoric about the potential use of its nuclear weapons "very dangerous and unhelpful."

"Nobody wants to see a nuclear war that nobody can win at. And as we do things, we are always mindful of making sure that we have the right balance and we're taking the right approach," Austin told reporters at a press briefing in Ramstein Air Base in Germany.

"There's always a possibility that a number of things can happen but again, I think it's it's unhelpful and dangerous to rattle sabers and speculate about the use of nuclear weapons," Austin said, following a trip to Ukraine's capital Kyiv alongside Secretary of State Antony Blinken.

Austin's remarks come after Russian Foreign Minister Sergey Lavrov warned that his country's war with Ukraine could escalate into a nuclear one.

Lavrov said late on Monday that the risks of nuclear war are now "very, very significant and should not be underestimated."