Russian forces have nearly taken full control of Soledar, a small mining town in eastern Ukraine, placing Moscow on the verge of its most significant gain since August.
The town is located just north of Bakhmut, where Ukraine has so far held strong despite some of the fiercest fighting in the war.
In the past few days, Ukrainian troops in Soledar were defending against a vigorous assault from the Russian mercenary company Wagner Group, and fierce fighting was reported in the town's administrative center on Monday.
The latest signs are that Russian and Wagner forces are now in control of Soledar after a four-day advance, Britain's Defense Ministry said in an intelligence update on Tuesday.
Ukrainian Deputy Defense Minister Hanna Maliar said in a statement on Tuesday that fighting is still ongoing in Soledar, which has been largely destroyed by Russian shelling, according to the Kyiv Independent.
Ukrainian President Volodymyr Zelensky has acknowledged that fighting in Soledar was a "difficult and hard battle" for his troops.
"It is extremely difficult - there are almost no whole walls left," Zelensky said in his nightly address on Monday.
"And what did Russia want to gain there? Everything is completely destroyed, there is almost no life left. And thousands of their people were lost: the whole land near Soledar is covered with the corpses of the occupiers and scars from the strikes."
Russian military blogger Rybar also said in a Telegram post on Tuesday that Russian Wagner Group forces "liberated the city center and drove the enemy to the northwestern outskirts" in Soledar.
Russia is likely to use Soledar in its effort to surround Bakhmut, which is roughly six miles away, and to disrupt Ukrainian lines of communication, U.K. intelligence said.
Seizing Bakhmut would allow Russia to advance onto other key locations in the eastern province, which Russian President Vladimir Putin illegally annexed last year.
Russia seized thousands of square miles in the region early in the war, launched in February, but has lost swathes of territory to Ukrainian counteroffensives in recent months. Russia last made territorial gains in August, according to a Washington Post tracker.
Much of the fighting near Bakhmut is being led by the Wagner Group, which has recruited thousands of Russian prisoners to the front lines. The Institute for the Study of War said the mercenary group is "responsible for block-by-block advances" in critical settlements around Bakhmut and in the city itself.
"[Wagner Group leader Yevgeny] Prigozhin will continue to use both confirmed and fabricated Wagner Group success in Soledar and Bakhmut to promote the Wagner Group as the only Russian force in Ukraine capable of securing tangible gains," the institute said in an analysis.
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