Ukraine and Russia: What you need to know right now

Russian forces in eastern Ukraine captured the center of the railway hub town of Lyman and encircled most of Sievierodonetsk, Ukrainian officials acknowledged on Friday, as Kyiv's forces fell back in the face of Moscow's biggest advance for weeks. 

FIGHTING

* Ukrainian forces are engaged in a "fierce defense" of the eastern city of Sievierodonetsk, which is two-thirds surrounded by Russian forces and 90% destroyed by shelling, the Luhansk region's governor said, citing the city administration head.

* Ukraine's forces may be forced to retreat from the final pocket of resistance in the region to avoid being captured, the governor said.

* Russian shelling killed at least seven civilians and wounded 17 in the city of Kharkiv in northeastern Ukraine, authorities said. read more

* In the southern Kherson region north of Russian-held Crimea, Ukrainian officials said Russian forces were fortifying their positions and trapping civilians with constant shelling. 

* The U.S. Army has awarded a contract worth up to $687 million to Raytheon Technologies Corp (RTX.N) for anti-aircraft Stinger missiles to replenish stocks sent to Ukraine, sources said.

DIPLOMACY

* Ukrainian President Volodymyr Zelensky said Russia was weaponizing a global food supply crisis and that the world must prevent large-scale famine. Moscow did not appear ready for serious peace talks, he said. 

* The Kremlin, which holds Ukraine and its Western allies responsible for the food crisis, said Kyiv was to blame for the fact that peace negotiations were frozen.

* Italian Prime Minister Mario Draghi and Ukrainian President Volodymyr Zelensky discussed ways to free up exports to tackle the food crisis threatening the world's poorest countries, Draghi's office said.

* Talks between Turkish officials and delegations from Sweden and Finland this week in Turkey made little headway in overcoming Ankara's objections to the Nordic countries joining NATO, and it is not yet clear when further discussions will take place, according to two sources.

ECONOMY

* European Union countries are negotiating a deal to embargo Russian oil deliveries by sea but not pipeline to win over Hungary and unblock the sixth package of sanctions against Moscow, officials said. EU ambassadors could seal a deal before a May 30-31 EU summit, one official said.

* Ukraine's state gas company said it had asked Germany's government to halt or severely curtail Russian gas flows through the Nord Stream 1 pipeline. Russia told Austria that Moscow would deliver on its gas commitments.

* Russia will need huge financial resources to fund its military operation in Ukraine, its finance minister said. The economy minister blamed Russia's economic troubles on low household spending.

* Russia is on the cusp of a unique debt crisis which investors say would be the first time a major emerging market economy is pushed into a bond default by geopolitics, rather than empty coffers. 

QUOTES

* "I'm afraid that Putin, at great cost to himself and the Russian military, is continuing to chew through the ground in Donbas," British Prime Minister Boris Johnson told Bloomberg UK, adding President Vladimir Putin was making "gradual, slow, but I'm afraid palpable progress".

COMING UP

* The EU summit on May 30-31 could see divisions between members who want to take a hard line against Russia and those calling for a ceasefire.