Russian forces have fully occupied Sievierodonetsk marking one of Ukraine’s biggest battlefield setbacks after weeks of some of the war’s bloodiest fighting.

Ukraine called its retreat from the city a “tactical withdrawal” to fight from higher ground in Lysychansk on the opposite bank of the Siverskyi Donets river. 

Pro-Russian separatists said Moscow’s forces were now attacking Lysychansk.

The fall of Sievierodonetsk, once home to more than 100,000 people, now a wasteland, was Russia’s biggest victory since capturing the port of Mariupol last month. It transforms the battlefield in the east after weeks in which Moscow’s huge advantage in firepower had yielded only slow gains.

Russia will now be hoping to press on and seize more ground on the opposite bank, while Ukraine will hope that the price Moscow paid to capture the ruins of the small city will leave Russia’s forces vulnerable to a counterattack in coming weeks.

“The city is now under the full occupation of Russia. They are trying to establish their own order, as far as I know they have appointed some kind of commandant,” Sievierodonetsk Mayor Oleksandr Stryuk said on national television.

Kyrylo Budanov, Ukraine’s military intelligence chief, told Reuters that Ukraine was carrying out “a tactical regrouping” by pulling its forces out of Sievierodonetsk to higher ground across the river.

“Russia is using the tactic … it used in Mariupol: wiping the city from the face of the earth,” he said. “Given the conditions, holding the defence in the ruins and open fields is no longer possible. So the Ukrainian forces are leaving for higher ground to continue the defence operations.”

Russia’s Interfax news agency cited a representative of pro-Russian separatist fighters as saying Russian and pro-Russian forces had entered Lysychansk across the river and fighting was taking place in urban areas there.

As Europe’s biggest land conflict since World War II entered its fifth month, Russian missiles also rained down on western, northern and southern parts of the country.

Russian President Vladimir Putin sent tens of thousands of troops over the border on February 24, unleashing a conflict that has killed thousands and uprooted millions. It has also stoked an energy and food crisis which is shaking the global economy.

Since Russia’s forces were defeated in an assault on the capital Kyiv in March, it has shifted focus to the Donbas, an eastern territory made up of Luhansk and Donetsk provinces. Sievierodonetsk and Lysychansk were the last major Ukrainian bastions in Luhansk.

The Russians crossed the river in force in recent days and have been advancing towards Lysychansk, threatening to encircle Ukrainians in the area.

The capture of Sievierodonetsk is likely to seen by Russia as vindication for its switch from its early, failed attempt at “lightning warfare” to a relentless, grinding offensive using massive artillery in the east.

Moscow says Luhansk and Donetsk, where it has backed uprisings since 2014, are independent countries. It demands Ukraine cede the entire territory of the two provinces to separatist administrations.

Ukrainian officials had never held out much hope of holding Sievierodonetsk indefinitely, but have hoped to exact a high enough price to exhaust the Russian army and leave the invasion force vulnerable to a counterstrike.