Singapore has urged its inhabitants to stay indoors after the city-state was engulfed by the worst haze in its history.

The massive smog cloud that hit the Southeast Asian country and parts of neighbouring Malaysia stemmed from forest fires on the Indonesian island of Sumatra.

"This is now the worst haze that Singapore has ever faced," Singapore's environment minister Vivian Balakrishnan wrote on his Facebook page. "No country or corporation has the right to pollute the air at the expense of Singaporeans' health and wellbeing."

Pollution in Singapore breached the "hazardous" level on the Pollutant Standards Index (PSI), reaching a record reading of 371, before scaling back to the "very unhealthy" level of 253 after a few hours.

Prime Minister Lee Hsien Loong advised residents to stay indoors as much as possible, and a number of football and sailing competitions were called off.

Lee said the haze cloud is expected to hang over Singapore for an unknown number of days because of wind and weather conditions.

Singaporeans have been photographed walking among the city's skyscrapers in a pall of noxious fumes, covering their faces with handkerchiefs.

Air traffic at Singapore's Changi Airport has not been affected, but flight controllers were instructed to take precautions because of lower visibility.

In Malaysia, some 200 schools were shut and authorities banned open burning in southern areas.

Illegal burnings

The fires were caused by illegal forest burnings, designed to clear land for profitable palm oil plantations. Such burnings often caused diplomatic friction between Indonesia and its neighbours.

The most recent smog outbreak on this scale occurred in 1997, when a haze cloud covered parts of southeast Asia for months, following the burning of an estimated 1.7 million hectares (17 000 km2) of tropical forest. Pollution in Singapore reached the then-record level of 226, which was comofrtably surpassed this week.

"We need urgent and definitive action by Indonesia to tackle the problem at source," Balakrishnan wrote. "Singaporeans have lost patience, and are understandably angry, distressed and concerned."

Balakrishnan added Singapore needs "to exert commercial pressure against companies causing the haze."

Jakarta officials defended their response to the haze, and suggested Singaporean and Malaysian palm oil companies might be involved in the burning.

Indonesia's coordinating minister for people's welfare, Agung Laksono, replied by saying that Singapore "should not be behaving like a child and making all this noise."

"This is not what the Indonesian nation wants, it is because of nature," Laksono said.

Talks between the two countries are scheduled to take place in Jakarta later today.