STORY: The head of Russia's Wagner mercenaries has made a sudden and dramatic announcement that he'll pull his forces out of Bakhmut because of heavy losses.

But Ukraine said they were in fact reinforcing their positions to try to seize the city before Russia marks victory in World War Two day next week.

Shortly before his statement on Friday (May 5), Wagner's Yevgeny Prigozhin appeared in the following graphic video, yelling and swearing at Defense Minister Sergei Shoigu and Chief of General Staff Valery Gerasimov.

He's surrounded by dozens of corpses, which he says are Wagner fighters.

Amid a torrent of expletives that were bleeped out by his press service, he lambasts the officials for a, quote, "70% shortage of ammunition".

Then came this video appeal, accompanied by a written statement to the head of general staff, the defense ministry, and President Vladimir Putin as supreme commander.

In it, Prigozhin said his forces would withdraw from the city on May 10 - ending their involvement in the longest and bloodiest battle of the war. That's the day after Victory Day, when Putin is to address the nation from Red Square.

"We were going to capture Bakhmut by May 9, 2023. However, having seen this, the pseudo-military bureaucrats practically stopped the supply of any ammunitions to prevent us from doing that. They are sitting there, jiggling their fat bellies and thinking that they will go down in history as winners. They have already gone down in history as cowards."

The announcement comes at a key juncture in the war before an expected counteroffensive by Ukraine.

Ukraine's Deputy Defense Minister, Hanna Maliar, said Russia was redeploying Wagner fighters from along the front line to Bakhmut.

Prigozhin asked defense chiefs to put regular army troops in the place of his soldiers.

He said what was left of Wagner would retreat to logistics camps to lick their wounds.

It was not clear if his declaration could be taken at face value.

He has posted impulsive comments in the past and only last week withdrew a statement he said was a "joke."

Bakhmut, a city of 70,000 before the war, has taken on huge symbolism for both sides because of the sheer intensity and duration of the fighting there.

Prigozhin said three weeks ago that his men controlled more than 80% of the city.

But Ukrainian defenders have held out.

The Kremlin declined to comment on Prigozhin's statement, citing the fact it was related to the course of its "special military operation" in Ukraine.