Russia says its forces are advancing north inside Pokrovsk in a drive to take full control of the Ukrainian city, while Ukraine's army says its units are battling hard to stop their progress.
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Ukraine has acknowledged its troops face a difficult position in the strategic eastern city, once an important transport and logistics hub for the Ukrainian army, which Russia has been trying to capture for more than a year.
Russia sees the city as the gateway to its capture of the remaining 10 per cent, or 5000 sq km of Ukraine's eastern industrial Donbas region, one of its key aims in the almost four-year-old war.
The Russian defence ministry said two assault groups were destroying Ukrainian troops that were surrounded in several districts of the city and continuing an offensive pushing north through it.
Russian forces were clearing Ukrainian troops from settlements on Pokrovsk's southeastern flank and had repelled Ukrainian attempts to break out of encirclement.
The Ukrainian military denied its troops were surrounded in Pokrovsk. It said they were trying to stop Russian soldiers from digging in while seeking to secure and protect logistics routes in the wider area.
"Measures are being taken to block the enemy, which is attempting to infiltrate and accumulate in the city of Pokrovsk," the Ukrainian General Staff said in a statement.
"Active countermeasures are being taken against attempts by enemy infantry groups to gain a foothold."
Moscow on Wednesday accused Ukraine of concealing the encirclement of its troops in the eastern cities of Pokrovsk and Myrnohrad.
Ukrainian President Volodymyr Zelenskiy said on Monday the area around Pokrovsk remained under severe pressure but up to 300 Russian servicemen still in the city had made no gains in the past day and there were just 60 soldiers in another city, Kupiansk.
The Russian Defence Ministry said on Wednesday that either Zelenskiy had no grasp of what was happening or he was deliberately trying to conceal the parlous situation for Kyiv's forces.
Ukrainian units were trapped in "cauldrons" in both locations, it said, and their position was deteriorating rapidly while Russian forces advanced, "leaving no chance for Ukrainian servicemen to save themselves other than by voluntary surrender".
Reuters was unable to verify either side's assertions because of restrictions on access to the battlefield from both sides.
Moscow says capturing Pokrovsk would give it a platform to drive north towards the two biggest remaining Ukrainian-controlled cities in Donetsk - Kramatorsk and Sloviansk.
It would give Moscow its most important single territorial gain inside Ukraine since it took the ruined city of Avdiivka in early 2024.
Open-source battlefield maps show Russian forces are a few kilometres away from fully encircling Pokrovsk, known by Russia as Krasnoarmeysk, and control a significant part of Kupiansk where they are advancing on the main road to the city.
Pokrovsk, a road and rail hub in Ukraine's eastern Donetsk region, had a pre-war population of some 60,000 people. But most people have now fled, all children have been evacuated and few civilians remain amid its pulverised apartment buildings and cratered roads.
As well as trying to take the whole of Donbas, Russia has been making gradual advances in the Kharkiv and Dnipopetrovsk regions further west.
Russia's military says it now controls more than 19 per cent of Ukraine, or some 116,000 sq km.
Ukrainian maps also show Russian control at about 19 per cent of Ukraine, up about one percentage point from Moscow's position two years ago.
Australian Associated Press
