Zaporizhzhia (Ukraine) (AFP) - Russia on Monday launched a fresh assault on the critical Ukrainian port of Odessa as the United States warned that Moscow was preparing formally to annex embattled regions in the east.

The new heavy fighting came as the European Union said it was bracing for a complete end to Russian gas supplies, with the bloc preparing another package of sanctions sure to anger President Vladimir Putin.

After failing to take the capital Kyiv, Moscow has shifted its two-month-old invasion to largely Russian-speaking areas and has stepped up pressure on Odessa, a celebrated cultural hub that is a crucial port on the Black Sea.

Odessa's city council said that a Russian strike hit a residential building housing five people. A 15-year-old boy was killed and a girl was hospitalised, the council said on Telegram.

"A 14-year-old boy was killed. A 17-year-old girl was wounded, she has a shrapnel wound," Ukraine's President Volodymyr Zelensky said in a video address, giving a different age for the boy.

"For what? What did these children... threaten the Russian state with? And that's how they fight. That's all," he said.

Fighting was particularly intense in eastern Ukraine around Izyum, Lyman and Rubizhne as the Russians prepared an attack on Severodonetsk, the farthest city still under Kyiv's control, Ukraine's general staff said.

In Lyman, relentless shelling has reduced hamlets around the city to rubble, according to AFP reporters.

"Half of the city is destroyed," said one resident, lifting luggage onto the roof of his beat-up Soviet-designed Lada car.

"I don't have a house anymore," he said.

The governor of the eastern region of Lugansk expected more intense battles ahead of May 9, the day Russia annually celebrates the 1945 surrender of Nazi Germany to allied forces, including the then-Soviet Union.

Russian Foreign Minister Sergei Lavrov, however, told Italian television that Moscow's forces "will not artificially adjust their actions to any date, including Victory Day".

'Sham referenda'

Whatever Russia's military decisions, the United States warned that Moscow was preparing imminently to annex both Lugansk and neighbouring Donetsk.

Pro-Russian separatists in the two regions declared independence in 2014, but Moscow has so far stopped short of formally incorporating them as it did that year with the Crimean peninsula, which it seized through special forces in unmarked uniforms.

"Russia plans to engineer referenda upon joining sometime in mid-May," said Michael Carpenter, the US ambassador to the Organisation for Security and Co-operation in Europe.

He said that Russia was considering a similar plan in a third region, Kherson, where Moscow has recently solidified control and imposed use of its ruble currency.

"We think the reports are highly credible," Carpenter told reporters in Washington.

As with Crimea, he vowed that the international community would not support Russian-dictated changes to Ukraine's borders.

"Such sham referenda -- fabricated votes -- will not be considered legitimate, nor will any attempts to annex additional Ukrainian territory," Carpenter said.

"But we have to act with a sense of urgency."

Evacuating battered Mariupol

The invasion has killed thousands and displaced more than 13 million people in a war the scale of which has not been seen in Europe for generations.

Among the most battered cities is Mariupol, where an untold number have died and survivors have little access to food, water and medicine as Russia battles to connect the southern and eastern strips of land under its control.

Kyiv said more than 100 civilians were evacuated over the weekend from the sprawling Azovstal steel plant, the last holdout of Ukrainian forces in Mariupol, where soldiers and civilians have been sheltering in a maze of underground tunnels.

Sviatoslav Palamar, deputy commander of Ukraine's Azov unit, said that another 20 people were transferred out on Monday evening, but only after a five-hour delay as "the enemy's artillery caused new rubble and destruction."

Ukraine and Russia have been coordinating civilian evacuations with the International Committee of the Red Cross.

US State Department spokesman Ned Price called on Russia to allow humanitarian supplies to enter Mariupol and other besieged cities.

Doing so would "demonstrate that there may be a genuine humanitarian intent behind this evacuation and not just another craven attempt on the part of the Kremlin to charge the narrative," Price said.

Ukrainian forces have recaptured some territory in recent days, including the village of Ruska Lozova, which evacuees said had been occupied for two months.

"It was two months of terrible fear. Nothing else, a terrible and relentless fear," Natalia, a 28-year-old evacuee from Ruska Lozova, told AFP after reaching Kharkiv.

But Kyiv has admitted that Russian forces have captured a string of villages in the east and has asked Western powers to deliver more heavy weapons to bolster its defences there.

Ukraine's defence ministry said Monday that its drones had sunk two Russian patrol boats near the Black Sea's Snake Island, which became a symbol of Ukrainian resistance after soldiers there rebuffed Russian demands to surrender.

"The Bayraktars are working," said Valeriy Zaluzhnyi, the commander in chief of the Ukrainian Armed Forces, referring to Turkish-made military drones.

Bracing for new sanctions

Western powers have levelled unprecedented sanctions against Russia over the war while delivering money and weapons to Ukraine, including a $33-billion (31 billion-euro) arms and support package announced by US President Joe Biden last week.

The European Commission will on Tuesday propose a new package of sanctions, including an embargo on Russian oil, officials said.

After talks on Monday, the European Union warned member states to prepare for a possible complete breakdown in gas supplies from Russia, insisting it would not cede to Moscow's demand that imports be paid for in rubles.

Germany, Europe's largest economy, before the war became heavily dependent on Russian gas, but European views quickly hardened after Putin attacked Ukraine.

EU and French officials said the 27-member bloc was united with Poland and Bulgaria, whose gas supplies were cut last week after they refused to pay in rubles.

Meanwhile British Prime Minister Boris Johnson will announce Tuesday another £300 million ($376 million, 358 million euros) in military aid for Ukraine, his office said.

In a new blow to Russian prestige, European football's governing body, UEFA, announced that Russian clubs had been banned from participating in the Champions League and all other European competitions next season.

Western nations have been trying to show support by reopening embassies in Kyiv that were closed due to the invasion, with Denmark the latest to make the move Monday.

Kristina Kvien, the US charge d'affaires, announced in the western city of Lviv that Washington hopes to have diplomats back in Kyiv by the end of May.

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