KYIV, Ukraine (AP) — Ukrainian forces are withdrawing from the front-line town of Vuhledar, perched atop a tactically significant hill in eastern Ukraine, after more than two years of grinding battle, military officials said Wednesday.

Vuhledar, a town Ukrainian forces fought tooth and nail to keep, is the latest urban settlement to fall to the Russians. It follows a vicious summer campaign along the eastern front that saw Kyiv cede several thousand square kilometers (square miles) of territory.

Ukraine’s Khortytsia ground forces formation, which commands eastern regions including Donetsk, said in a statement posted on Telegram it was withdrawing troops from Vuhledar to “protect the military personnel and equipment.”

“In an attempt to take control of the city at any cost, reserves were directed to carry out flanking attacks, which exhausted the defense of the units of the Armed Forces of Ukraine. As a result of the enemy’s actions, there arose a threat of encircling the city,” the statement said.

The tactical significance of the town, situated at the confluence of two major roads, is two-fold. Dominant heights and proximity to railway lines offer Moscow greater protection for their own logistics routes, and a better vantage point for attacks against Ukrainian forces and supply lines feeding the south.

Its capture is another notch in Moscow’s belt, bringing it closer to the key logistics hub of Pokrovsk.