MOSCOW - Russian President Vladimir Putin said Ukraine had extinguished the "final hope" of a U.S.-backed peace deal after its forces launched an offensive on pro-Russia separatists Friday.
The Ukrainian military began its raid on the occupied city of Slovyansk at dawn in what was its most committed attempt to dislodge separatists occupying government buildings across its Russian-speaking, industrial east.
Two Ukrainian helicopters were shot down killing at least two people, both sides said. The separatists claimed their forces shot down a third helicopter and said one of their own fighters had also been killed, according to Russia’s Interfax news agency.
Putin’s spokesman Dmitry Peskov called the offensive “punitive” and said it effectively destroyed the “final hope” of a peace accord reached in Geneva last month between the U.S., Russia, Europe and Ukraine, Interfax said.
The clashes came as the German leader, Chancellor Angela Merkel, was in Washington for talks with President Barack Obama on the possibility of slapping further sanctions on Moscow for its actions on its former Soviet neighbor.
Two MI-24 helicopters were shot down and one more MI-8 helicopter was damaged by gunfire, according to a Ukrainian Defense Ministry statement.
Four people were arrested on suspicion of shooting down the helicopters near the city, Ukraine's defense ministry said. Interfax Ukraine also reported that a helicopter pilot had been captured from one of the down aircraft and "as far as we are informed, he is undergoing surgery in a medical institution," the news agency said, quoting Ukraine Defense Minister Yuriy Povkh.
An earlier statement by the Ukrainian Security Service said separatists were also shooting at an emergency helicopter that arrived to provide medical aid. One of the paramedics was injured, it said.
James Mates, correspondent with NBC News' U.K. partner ITV News, said separatists were controlling roads in and out of the city.
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The shooting began around 4 a.m. Friday (9 p.m. ET Thursday), according to Reuters journalists in the city. The militants were holding a number of local people and seven foreign military observers, four of them German, from the European security agency the OSCE, the news agency said.
NBC News was not able to independently verify these reports.
The security service, known as the SBU, said one of the helicopters was shot down by anti-aircraft missiles. That showed the separatist fighters were "well-prepared, high qualified foreign military specialists and not local peaceful citizens who have guns acquired in hunting shops, as Russian leadership says," the SBU said.
The U.S. has also said it believes the separatists are being supported by Moscow's forces.
Ukraine has launched several "anti-terrorism" offensives across the east in an attempt to dislodge separatists who oppose the Western-backed Kiev government and have taken control of government buildings.
An analysis published by the London-based Royal United Services Institute said Ukraine’s fresh drive could push Russia "to the very brink of overt intervention."
“For the past two weeks Slovyansk has been the focus of a game of deterrence and brinkmanship that both leaderships feel compelled to play," said the RUSI report. "Despite evident Russian military planning, neither is likely to be in full control.
"This Ukrainian operation to recover control of Slovyansk may propel Moscow to the very brink of overt intervention."
The Geneva peace accord was widely believed to be in tatters long before Putin signaled its demise Friday.
