Ukrainian government forces have pulled back from a key combat zone in the eastern part of the country, after days of violence in the area despite a supposed cease-fire.
Around 80 percent of soldiers had withdrawn from the town of Debaltseve, according to Ukraine President Petro Poroshenko, who was quoted by Reuters.
He added that the withdrawal was being carried out in a "planned and organized" manner and comes after unconfirmed reports by pro-Russian separatists that government troops were surrendering.
The cease-fire agreement, signed last week by Russia and Ukraine, was supposed to lead to the withdrawal of heavy artillery in the key conflict zones in the east of the country. Debaltseve has seen continued fighting, however, and a huge gas explosion near the town Tuesday was reported to be caused by a mortar shell hitting a gas pipeline.
The battle for this strategic location - with its key transport links - could be a potential turning point in the war over the eastern region of Donbas – and also the conflict in Ukraine more broadly.
"The loss of Debaltseve, defended by very significant Ukrainian forces, would perhaps send a clear signal that Russian-backed rebels have the potential, almost at will, to further extend gains into Donbas, and even the rest of Ukraine," Timothy Ash, head of emerging markets at Standard Bank, said before the withdrawal.