Grozny's crowded central market came under rocket attack last night, with witnesses reporting numerous deaths and scores of injured civilians. The blast came as Russian troops edged closer to Chechnya's capital, taking positions as little as seven miles from the centre.
The source of the explosion was not immediately clear. One witness said that three missiles were dropped by planes on the market place, where local residents were shopping for food. Another said the blast, which shook buildings in the capital's centre, was caused by surface-to-surface missiles, fired by Russian federal forces.
The Russian defence ministry last night initially denied allegations that federal units had attacked the centre of Grozny; later officials would say only that they were unable to make any immediate comment on the explosions.
The Chechen armed forces' chief of operations, Mr Mumadi Saidayev, said several missiles hit the market, while other missiles exploded near the post office, and near the palace of Chechen president Aslan Maskhadov. A traffic jam formed as residents tried to flee the capital in the aftermath of the blast.
Hours before the attack, Russia's leading politicians and senior military figures issued a series of contradictory statements about plans to launch an assault on Grozny.
But despite this apparent confusion, a high-level decision to target Grozny's market would be at odds with the military's constant insistence that the campaign aims to minimise civilian casualties.
Russian officials have been denying for weeks that storming Grozny would be the next stage of their campaign to rid Chechnya of the terrorists they hold responsible for last month's devastating apartment block explosions across Russia. But their unanimous approach to this question appeared to be dissolving yesterday.
Mr Nikolai Koshman, the Moscow-appointed administrator of Chechnya's Russian-held areas, claimed Moscow intended to seize the region around Grozny.
His comments immediately intensified speculation that Russian forces would then press forward into the capital, the scene of the bitterest fighting in the 1994-96 war, in which tens of thousands of people died.
As he departed for a meeting with European Union leaders, Russia's Prime Minister, Mr Vladimir Putin, admitted he had yet to decide whether troops would try to storm Grozny. The Foreign Minister, Mr Igor Ivanov, was clearer, commenting that there were "no plans for a massive land assault on Grozny" because that would risk too many civilian casualties.
He claimed the only way forward was a political solution. "We are not trying to carry out any major ground attack. The job consists of liquidating the terrorist groups and not allowing any more loss of lives among the civilian population and the Russian military."
The defence ministry said yesterday that 196 Russian soldiers had been killed in the north Caucasus since August when federal forces responded to what they described as an Islamic militant incursion into neighbouring Dagestan.
Today's meeting with EU leaders is intended to build a new spirit of partnership, but is likely to be overshadowed by the violence in Chechnya.
A high-ranking EU delegation, including the Commission President, Mr Romano Prodi, and the new foreign affairs representative, Mr Javier Solana, is due to meet Mr Putin and Mr Ivanov in Helsinki.
Long-planned discussions about how to forge better ties with Russia as the 15-member bloc prepares to enlarge eastwards now look set to fade into the background.
EU leaders have already appealed to Moscow for restraint in Chechnya, fearing a humanitarian disaster.