Russian forces shelled and bombed towns and cities in eastern and southern Ukraine on Tuesday, a day after Russia's foreign minister said Kyiv must accept Moscow's demands for ending the war or else suffer defeat on the battlefield.
Those demands include Ukraine recognizing Russia's conquest of a fifth of its territory. Kyiv, armed and supported by the United States and its Nato allies, has vowed to recover all occupied territory and to drive out all Russian soldiers.
Britain's defence ministry said in its latest update of the situation in Ukraine that fighting was particularly intense around the strategic eastern city of Bakhmut in Donetsk province and Svatove, further north in Luhansk province.
Donetsk and Luhansk, which make up the industrial Donbas, are both claimed, along with two southern Ukrainian regions, by Russia.
"Russia continues to initiate frequent small-scale assaults in these areas (of Bakhmut and Svatove), although little territory has changed hands," the British ministry tweeted.
Reuters reporters saw fires burning in a large residential building in Bakhmut, while debris littered the streets and most buildings had had their windows blown out.
"Our proposals for the demilitarization and denazification of the territories controlled by the regime, the elimination of threats to Russia's security emanating from there, including our new lands, are well known to the enemy," TASS news agency quoted Russian Foreign Minister Sergei Lavrov as saying on Monday.
Kyiv and its Western allies reject this stance, saying that Russia is engaged in a brutal, imperialist land grab in Ukraine.
The West has slapped sweeping sanctions on Moscow, including on Dec. 5 a $60 per barrel cap, imposed by the Group of Seven nations, the European Union and Australia to curb Russia's ability to fund the war.
On Tuesday, Finance Minister Anton Siluanov said Russia's budget deficit could be wider than a planned 2% of national output in 2023 as the oil price cap squeezes export income, in the clearest acknowledgement yet the cap could hit finances.
After suffering a series of defeats in its "special military operation," Russia is now seeking a battlefield victory by capturing Bakhmut, an industrial city with a pre-war population of 70,000, now reduced to about 10,000 mostly elderly residents.
Gaining control of the city could give Russia a stepping stone to advance on two bigger cities, Kramatorsk and Sloviansk.
Over the past 24 hours, Ukrainian forces have repelled Russian attacks in the areas of two settlements in Luhansk province and six in Donetsk, the General Staff of Ukraine's Armed Forces said on Tuesday.
