The once familiar chill of Cold War hostility appeared to be embracing UK-Russian relations again last night as Moscow let out an icy blast in response to Britain's expulsion of its London-based diplomatic staff.

Yet while people expect a tit-for-tat response from Moscow, the deterioration in UK-Russian relations has been going on for some time.

From the Kremlin's outlook, London has become Londongrad, home to a range of expatriates who are deeply critical of the Russian government.

Key among these critics is Boris Berezovsky, the tycoon granted refugee status in the UK. London has repeatedly rejected Moscow's entreaties to extradite Mr Berezovsky, who is wanted in the Russian capital on several criminal charges. However, the dissident insists the charges have been invented to silence him.

Russia also blames Britain for granting asylum to several leading Chechen rebels, most notably to Akhmed Zakayev. The Putin government says London's refusal to hand Mr Zakayev over for trial betrays its double standards in dealing with the terrorist threat.

On energy, British oil giant BP was forced last month to sell its stake in the Siberian Kovykta gas field to state-controlled firm Gazprom at a knock-down price. The deal became part of the Kremlin's drive to tighten its grip over Russia's oil and gas resources, fuelling concerns in the West about the safety of its own energy supplies. Last December, the Anglo-Dutch oil giant Royal Dutch Shell had to cede a part of its Sakhalin-2 project.

On Kosovo, Russia has blocked a British draft resolution in the UN Security Council, which would effectively give independence to Serbia's breakaway province.

Today, Mr Miliband will meet British businessmen, seeking to reassure them that trade will continue unaffected.

One group of onlookers who will not mind too much about the spat are the neo-cons in Washington, giving Gordon Brown's trip to the US shortly something of a diplomatic uplift.

Yet as the political temperature plunges between London and Moscow, the question last night was just where will it all end and could this really be the start of something bad.