Ukrainian forces have been told to retreat from the encircled city of Severodonetsk after some of the heaviest fighting of the war with Russia.
Regional governor Serhiy Gaidai said it made no sense for Ukrainian troops to "remain in positions smashed to pieces over many months, just for the sake of staying there".
The fall of the eastern city would give Russia control over most of the Luhansk region, with only its sister city Lysychansk on the opposite bank of a river remaining in Ukrainian hands.
Capturing Severodonetsk has become a key goal of Russian generals after they refocused their offensive on the east following setbacks around Kyiv in the early weeks of the war.
The industrial hub has seen weeks of street-by-street fighting as the outgunned Ukrainians put up a fierce defence.
But the city has been "nearly turned to rubble" by sustained Russian bombardment, the regional governor said;.
“We will have to pull back our guys,” he said. “It makes no sense to stay at the destroyed positions, because the number of casualties in poorly fortified areas will grow every day.”
He said troops in the city "have already received the order to move to new positions," but did not say whether they had already done so or where they were going.
The Ukrainian forces had already been pushed back from much of the city, leaving them in control of only industrial areas.
Russia said on Friday that four Ukrainian battalions and other fighters totalling about 2,000 soldiers had been “fully blocked” near Hirske and Zolote, south of Lysychansk.
Mr Gaidai said the Russians were now advancing on Lysychansk, which has been facing increasingly heavy Russian bombardment.
Journalists driving out of the city on Thursday had to jump out of cars and lie on the ground as Russian forces shelled its main supply road, AFP reported.
They saw dark smoke rising over the road ahead, and heard artillery fire and saw flashes of light, while the road was strewn with trees felled by shelling.
Elsewhere, the pro-Russian side reported the death of an official in the Kremlin-friendly administration in Kherson, a southern city captured by Russian troops early in the invasion.
The government said Dmitry Savlyuchenko died when his vehicle exploded in what it described as a “terror attack.” There was no immediate claim of responsibility.