By Helen Regan, Hafsa Khalil, Jeevan Ravindran, Aditi Sangal, Ed Upright and Adrienne Vogt, CNN
From CNN's Olga Voitovych
Oleksiy Arestovych, an adviser to the head of the Ukrainian President's Office, said on national television that "the fight for Lysychansk and Severodonetsk has entered its climax."
This phase looks terrifying from a military point of view," he said.
Arestovych compared the situation to the "18th round" of a boxing bout. "Any side that sends two battalions of artillery there wins this fight. Let's see who sends. Who has [those battalions] -- only the military command on both sides knows."
From CNN's Sharon Braithwaite in London
UK Foreign Secretary Liz Truss said Thursday it is "urgent" to solve the Ukraine grain crisis within the next month to avoid a "devastating" outcome.
Speaking in Ankara alongside Turkish Foreign Minister Mevlut Cavusoglu, Truss once again accused Russian President Vladimir Putin of "weaponizing hunger" and stressed that if this difficult situation is not resolved, it will likely lead to "a huge hunger across the globe."
"He [Putin] blocked the Ukrainian ports and is stopping 20 million tones of grain being exported across the globe, holding the world to ransom," said Truss, who is in Turkey to discuss the plan to get the grain out, supported by the United Nations.
"We are clear the commercial vessels need to have safe passage to be able to leave Ukrainian ports, and that Ukrainian ports should be protected from Russian attacks," she said, adding that, "Russia cannot be allowed to delay and prevaricate."
We are very clear that this grain crisis is urgent and it needs to be solved within the next month, otherwise we could see devastating consequences," Truss said.
From CNN's Tim Lister
As Russian forces close in on the city of Lysychansk, Ukrainian military commanders have an unenviable choice. They can defend the city, block by block, against vastly superior firepower -- or they can withdraw to take up new defensive positions further west.
Defending the city would inevitably mean heavy casualties among both soldiers and the thousands of civilians who are still sheltering there. The Russian bombardment of the city -- like that of neighboring Severodonetsk -- has been largely indiscriminate.
Additionally, the resupply corridor along the T1302 highway to Bakhmut might be cut off, leaving Ukrainian troops surrounded.
In some places, Russian units advancing from the south are within five kilometers (three miles) of the highway. While other resupply routes are available, they would be difficult and vulnerable. The Institute for the Study of War, in its latest assessment, says; "Russian forces will likely continue to regroup and intensify operations in the area between Bakhmut and Lysychansk to advance toward Lysychansk from an additional axis, sever Ukrainian supply lines, and attempt to consolidate control of the entire Severodonetsk-Lysychansk area in the coming days."
On the other hand, one advantage of staying and fighting in Lysychansk is that it is on higher ground than surrounding areas, and Ukrainian forces would likely to be able to hold back and inflict damage on Russian units for some time -- perhaps weeks. Lysychansk would potentially become another Mariupol. By sucking in Russian units, the city's defenders would probably relieve the pressure on other fronts, such as around Sloviansk.
The dilemma for the Ukrainian military is an urgent one. As the pocket in Luhansk and Donetsk regions that they defend shrinks, the option of a tactical withdrawal to new lines of defense may not last long.
From CNN's Nadine Schmidt in Berlin
Germany has activated the second phase of its three-stage emergency plan for natural gas supplies, the country's Economy Minister and Vice Chancellor Robert Habeck announced Thursday.
Gas is from now on in short supply in Germany," Habeck told reporters at a press conference in Berlin.
Habeck called on Germans to reduce their fuel use as part of a national effort. ''We are now calling to reduce gas consumption,'' particularly looking ''ahead to the upcoming winter months."
The minister said the government's decision to raise the level to "alarm'' follows the cuts to Russian deliveries made since June 14 and the continued high market price for gas. Habeck said the third and highest stage is the "emergency'' level.
Germany is heavily reliant on Moscow's gas to power its homes and heavy industry, but has managed to whittle Moscow's share of its imports down to 35% from 55% before the start of the war in Ukraine.
Habeck said security of supply was currently guaranteed in spite of a "worsened situation on the gas market" in recent days. Soaring prices were "[Russian President Vladimir] Putin's strategy to unsettle us, drive up prices and divide us," Habeck said.
We are in an economic confrontation with Russia," Habeck said.
Habeck said while gas storage facilities are currently filled to 58% capacity -- higher than at this time last year -- the goal of reaching 90% by December won't be achievable without further measures.
From CNN's Tim Lister
Besides the bombardment of Ukrainian defenses in Severodonetsk and Lysychansk, officials say there's been shelling by Russian forces on various other fronts, causing a number of civilian casualties.
In Donetsk, authorities say several settlements came under fire, including the cities of Sloviansk and Bakhmut. Dozens of settlements in the region are without water or electricity.
The government said Thursday that four districts in the Sumy region in north-eastern Ukraine had again been hit by cross border shelling.
There were about a hundred incoming artillery shells from the Russian side. One man died as a result of a munition dropped from an enemy drone," said one official.
Five people were injured and one died as a result of a mine blast in the Okhtyrka district of Sumy, regional authorities said.
In the south, the district of Kryvyi Rih was shelled, leaving two people wounded. The regional administration said that the town of Apostolove was now littered with cluster munitions. CNN can't verify the claim.
Authorities said that Russian shelling of villages behind the frontline that runs along the Kherson-Mykolaiv border continued and that inside Kherson the situation was critical in several settlements.
From CNN's Nadine Schmidt in Berlin
German Chancellor Olaf Scholz announced on Wednesday he wants to discuss the outlines of a ''Marshall Plan for Ukraine," with the leaders of the Group of Seven countries at the upcoming summit in Germany.
''Just like Europe was devastated by war, Ukraine needs a Marshall Plan for reconstruction,'' Scholz told lawmakers at the Bundestag, adding that rebuilding Ukraine would be a ''task for generations.''
Some context: The Marshall Plan, a US-funded initiative enacted in 1948, helped rebuild Western Europe after WWII. Scholz hopes for a united front on long-term support for Ukraine when Germany hosts the annual G7 summit in Bavaria.
Following his visit last week to Iripin, a Kyiv suburb which saw intense fighting at the beginning of the Ukraine war, Scholz said it reminded him "of the pictures of German cities after World War II.''
Billions of dollars would be needed for Ukraine to finance rebuilding over several years, he said, adding that this would only be possible if European nations, other major donor countries and international organizations work together.
Scholz has invited Ukrainian President Volodymyr Zelensky to discuss financial aid for Ukraine with the G7 leaders by video link on Monday.
From CNN's James Frater in Brussels and Niamh Kennedy in Dublin
European Council chief Charles Michel has called Thursday a "decisive moment" for the bloc as EU leaders meet to discuss Ukraine's bid to gain membership.
"This is a decisive moment for the European Union. A geopolitical choice that we will make today," Michel told reporters on his way into the European Council summit in Brussels.
EU leaders are considering whether to approve the European Commission's decision last week to grant Ukraine EU candidate status.
The European Council President said he was "confident" that EU leaders will grant candidate status to Ukraine and Moldova and "express a clear and strong" European perspective for both nations.
European Parliament chief Roberta Metsola also hailed Thursday as a "historic" day, expressing her "hope" that Ukraine's candidate status will be given the greenlight.
"A day where I thought we would wait much longer to have it on paper, and I really welcome the unity and the leadership of the European Union on this," she said.
From CNN's Tim Lister and Olga Voitovych
The Ukrainian military has released video showing extensive destruction in Lysychansk, the last city in Luhansk region still under Ukrainian control.
The commentary on the video says the city is "half-destroyed by Russian artillery."
Released on Thursday, the video shows rockets embedded in streets and large holes blown through apartment buildings.
The city's roads are deserted — littered with upended vehicles — and the sound of incoming rounds seems almost constant. One sends the film crew running for cover.
In the video, commentary said the Russians have so many weapons they can subject whole neighborhoods to barrages of shelling.
An unnamed woman whose identity is disguised says: "People die in their apartments, in their homes, in their yards."
A Ukrainian soldier said communications are difficult because the Russians are employing electronic warfare measures, meaning the state emergency service can't reach victims of the shelling, nor organize evacuations.
As a soldier leaves the city in a vehicle, he points out Lysychansk's oil refinery, which he says has been burning for weeks.
From CNN's Tim Lister
The UK Ministry of Defence said on Thursday that Russian forces have been advancing on the outskirts of Lysychansk over the past five days.
Since June 19, "Russian forces have highly likely advanced over 5 kilometers (3 miles) towards the southern approaches of the Donbas city of Lysychansk," the MoD said on Twitter in its latest assessment of the conflict in Ukraine.
"Some Ukrainian units have withdrawn, probably to avoid being encircled. Russia’s improved performance in this sector is likely a result of recent unit reinforcement and heavy concentration of fire.
"Russian forces are putting the Lysychansk-Sieverodonetsk pocket under increasing pressure with this creeping advance around the fringes of the built-up area. However, its efforts to achieve a deeper encirclement to take western Donetsk Oblast remain stalled."