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Russia rehearsed its response to a nuclear attack on Wednesday in an exercise involving nuclear submarines, strategic bombers and ballistic missiles at a time when tensions are high over a “dirty bomb” allegation it has made against Ukraine.

CONFLICT

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* Ukraine’s counter-offensive against Russian forces in its southern Kherson region is proving more difficult than it was in the northeast because of wet weather and the nature of the terrain, Ukraine’s defense minister said.

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* Russian-installed authorities in Kherson city have been encouraging residents to flee to the east bank, but Oleksiy Arestovych, adviser to Ukrainian President Volodymyr Zelenskiy, said there was no sign that Russian forces themselves were preparing to abandon the city.

* A Russian-backed separatist official in Ukraine’s eastern Luhansk region said heavy fighting was taking place in the region’s Kreminna and Svatove districts.

* Russia said it would continue to make the case to the international community that it believed Ukraine intended to detonate a “dirty bomb” with radioactive contaminants. Ukraine has said the allegation is false and that Russia may be airing it in preparation for using such a weapon and blaming Ukraine.

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DIPLOMACY

* Russian President Vladimir Putin observed exercises by Russia’s strategic nuclear forces and told intelligence chiefs of several former Soviet countries that the risk of conflict in the region and the world was high.

* Russia has notified the United States about the planned annual exercises of its nuclear forces, which Washington said lowered the risk of miscalculation at a time of “reckless” Russian nuclear rhetoric.

* Putin is likely to use the possible extension of the U.N.-brokered Black Sea grain deal as a way to gain leverage and dominate next month’s G20 summit in Indonesia, a European diplomat briefed on the grain talks told Reuters.

* A group of liberal U.S. Democrats withdrew a letter to the White House urging a negotiated settlement to the Ukraine war after blowback from within their own party.

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ECONOMY

* Kazatomprom KZAP.KZ, the world’s biggest uranium miner, is seeking to boost the capacity of its alternative shipping route which bypasses Russia to mitigate risks from potential sanctions, the Kazakh company said.

* Mercedes-Benz MBGn.DE said it would withdraw from the Russian market and sell shares in its industrial and financial services subsidiaries to a local investor, becoming the latest carmaker to exit the country.

* London’s High Court lifted a temporary block on a case brought by former investors in defunct oil group Yukos seeking to enforce a $50 billion arbitration award against Russia in Britain.

QUOTE:

“It’s a game of roulette,” said a Russian officer, describing Ukrainian bombardment near Balakliia in northeastern Ukraine in September before Russian troops withdrew from the area. “You either get lucky, or you are unlucky. The strikes can land anywhere.” (Compiled by Cynthia Osterman, Lincoln Feast and Philippa Fletcher)