US allies in Europe are conducting intelligence operations against President Trump's staff and business associates and intercepting communications between advisors in the White House and Russian government officials.

Sources told Newsweek that a Western European country and Baltic nation are gathering intelligence on officials in the White House and executives at The Trump Organization out of concern for President Trump's foreign policy shift towards Russia.

According to the Newsweek report, a Western European Agency has intercepted at least one contact between a Russian official based in the US and Michael Flynn, who resigned from his role as National Security Advisor this week after his secret phone calls with the Russian ambassador emerged.

The foreign agency is also said to be compiling electronic and human information on Trump's overseas business partners, some of whom are thought to be government agents.

Ewan Lawson, a senior research fellow at UK think tank Royal United Services Institute (RUSI), commented: "It is entirely understandable that European intelligence agencies would be intercepting communications with Russian officials and I would suggest that they are the target rather than the Trump administration."

"It is interesting that the interception has taken place on Russians inside the US but as Snowden revealed it is not uncommon for nations to conduct espionage activity within apparently friendly states even if these are only targeted at third parties."

Western European intelligence on Trump's links with Russia has been gathered since August, when the British government obtained information that Russian agents were in contact with members of Trump's campaign team. The information was widely shared with other Nato members in Europe, Newsweek reports. One source claimed that Theresa May's staff were briefed on the investigation's findings before the UK prime minister met Trump last month. Officials in the German government are also said to have received the information.

The surveillance operations are being carried out following increasing concern that Russian President Vladimir Putin is using his relationship with the Trump administration to destabilise the Nato alliance, according to the sources who spoke to Newsweek on the condition of anonymity. A Baltic country is conducting an investigation out of fear that Russia's gaining influence with the US president could endanger its sovereignty, according to an individual with close ties to the nation's government.

The source said that the Baltic nation has also launched an investigation into US Secretary of State Rex Tillerson's close relationship with Igor Sechin, an ally of Putin and executive chairman of state-owned Russian oil company Rosneft.

The Foreign Office and GCHQ declined to comment on intelligence matters.

Trump's National Security Adviser Michael Flynn (right) resigned after his ties with Russian officials emerged Reuters/Carlos Barria