The Sydney Siege today has left a gunman holding up to 20 people -staff and customers - hostage in utter darkness at the Lindt cafe in the city centre. The cafe is currently surrounded by armed police officers who have made contact with the gunman of the Sydney Siege.

Earlier, five people were seen running from the building. It still remains unclear how many remain inside the cafe after under the Sydney Siege. Meanwhile, a black Islamic flag has reportedly been displayed at the window.

It was "profoundly shocking" that people were being "held hostage by an armed person claiming political motivation", said Prime Minister Tony Abbott about the Sydney Siege.

Abbott was speaking after becoming chair at a meeting of the national security committee in Canberra.

"Australia is a peaceful, open and generous society - nothing should ever change that and that's why I would urge all Australians today to go about their business as usual," Abbott said earlier about the Sydney Siege.

"Many police officers started to come around us," said Andrea Proctor, an eyewitness.

According to senior police officers, they are on a footing "consistent with a terrorist event" with the developments in the Sydney Siege case.

The Sydney Siege started while people were arriving for work in Martin Place Monday. According to witnesses, they saw a man with a bag and gun walk into the Lindt chocolate shop and cafe, reports the BBC.

About 10 employees and 30 customers were believed to be inside at the time the Sydney Siege began. Nearby offices have been evacuated while police asked people to remain indoors and away from open windows.

Jon Donnison of the BBC in Sydney said that an enormous police operation is in place for the Sydney Siege. He added that its scale is only a few Sydney residents will have seen.

Six hours into the Sydney siege, three people were reportedly seen running from the building where the cafe was located. Another two followed after about an hour. It remains unclear whether these people have escaped or were released.

According to journalist Chris Reason, who happened to have a view of the cafe from the Channel 7 building, the gunman was "extremely agitated" when the hostages fled the scene of the Sydney siege.

As night fell, lights inside the cafe were turned out. Reason also told Sky News that the cafe had "gone completely black".

"We can see very little of what is going on inside, which is obviously not good news," Reason said. "From our position over the last couple of hours we have counted 15 hostages in total. Five of those have escaped."

"They are all ages, all demographics. Fortunately no children that we could see," Reason added describing the Sydney siege.

Apparently, the gunman forced hostages to stand at the window with their hands against the glass. They were also rotated every two hours during the Sydney siege.

The gunman has already contacted several media outlets from the cafe. According to reports, he demanded an IS flag delivered at the scene of the Sydney siege, while hostages were used as human shields.

"Those people are now being assessed to make sure their health is okay and then police will talk to them," said New South Wales Police deputy commissioner Catherine Burn, speaking nine hours into the standoff.

She added that the main goal was to resolve the Sydney siege situation peacefully even if it would take the whole night.

"Our approach is to resolve this peacefully. It might take a bit of time but that is our priority," Burn added.

As of the moment, police negotiators were still in contact with the gunman, according to Burn. The suspect also contacted local news organisations to make demands; however, police urged the media not to broadcast these demands.

The armed Sydney siege suspect was seen wearing a backpack and a bandana, circling inside the cafe.

Sky News reports that chilling footage has been released of the Sydney siege, where a female hostage apparently trying to communicate with police by miming her throat being cut. Meanwhile, news channels have chosen not to broadcast a video of another hostage which relayed the suspect's demands.

Earlier, there had also been TV footage that showed at least three people who were visibly distressed. They held up to the window a black flag which bore the declaration of Islamic faith.

"There is no God but Allah, and Muhammad is his messenger," read the flag.

The flag was reportedly similar to those used by jihadist groups, but different from the one used by Islamic State militants in the Middle East.

Two hostages told Channel Ten that the Sydney siege gunman claimed to have four bombs - two inside the cafe and two elsewhere in the financial district.

Martin Place is known to be home to the state premier's office and the headquarters of major banks.

After the Sydney siege, up to 100 heavily armed police surrounded the area.

Trains and buses were stopped and roads were blocked in the area. Train operators said there had been a bomb threat at Martin Place.

Major landmarks in the city were evacuated due to the Sydney siege incident.

Police are now investigating reports that the Sydney siege assailant used the social media accounts of his hostages' to demand a meeting with Australian Prime Minster Tony Abbott.

Hours after the Sydney siege, a social media campaign started trending globally. People posted with the hashtag #illridewithyou to show solidarity with Muslims.

According to police, they are now working "on a footing" if the Sydney siege is a terrorist incident. They said however, that they remain "confident" of a peaceful resolution.

Negotiators are already in contact with the Sydney siege assailant.

Australia is backing the United States and their heightened action against ISIS. Australia is now on high alert for attacks by radicalized Muslims or by the nation's fighters returning from fighting in the Middle East, Reuters reports.

In September, Australia sent fighter jets to join the US-led coalition which conducted air strikes against Islamic State in Iraq. The country also carried out a big anti-terror raid.

In October, new anti-terrorism laws were reportedly approved by the Australian parliament.