Ukraine and Russia are moving towards a potential deal to end the war, Bloomberg News reported on Friday, citing the top aide to Ukrainian President Volodymyr Zelenskyy.

Kyrylo Budanov, a former head of Ukraine's military intelligence, said that he saw progress towards a deal, but declined to say what a potential compromise on territory, a key stumbling block, would look like.

"No final decision has been made yet," he said, according to the report. "But, in principle, everyone now clearly understands the limits of what is acceptable. That’s enormous progress." "They all understand the war needs to end. That’s why they are negotiating,” Budanov said in an interview with Bloomberg on April 4. “I don’t think it will be long.”

Budanov was appointed head of Zelenskyy's office in January and has become a key Ukrainian negotiator during US-brokered talks between Kyiv and Moscow.

The only tangible outcome from several rounds of talks this year was the exchange of prisoners of war. In the latest exchange in March, Ukraine and Russia swapped 500 POWs.

Another prisoner swap was possible ahead of the Orthodox Easter this weekend, Ukrainian officials said.

Russia, Ukraine agree to Easter ceasefire

Russia announced a 32-hour ceasefire over two days for Orthodox Easter, and Ukraine agreed to reciprocate that. The Kremlin said the ceasefire would be in effect from Saturday at 4 p.m. (1300 GMT) to midnight (2100 GMT) on Sunday.

Budanov said that Kyiv and Moscow maintained “maximalist” positions in the talks so far, but believed the positions would be closer in the search for a compromise. Russia demands that Ukraine withdraw from parts of Donbas that Kyiv still controls. Ukraine refuses to do so.

Zelenskyy has said that, given a ceasefire between the US and Iran in the Middle East, a new trilateral meeting of negotiating teams could take place soon. He said that the spring and summer months would be difficult for Ukraine as it would face pressure on the battlefield and also diplomatically to end the war.

Earlier this week, Zelenskyy said he had asked the United States to pass on a proposal for a holiday weekend truce to Moscow, as a first step.

Ukraine has also increased its drone attacks on Russia, targeting its energy exports in particular in a series of intense strikes. Russia says residential houses were also hit.

Earlier this year, Russia claimed it had called an "energy truce" – halting its devastating strikes on Ukraine's power plants in the depths of winter – but the pause lasted just long enough to prepare the missiles for the next major attack.

Last May, Russia declared a unilateral halt to the fighting to mark the 80th anniversary of the Soviet victory over Nazi Germany. That time, Ukraine recorded hundreds of ceasefire violations.

What Kyiv really wants – and has proposed, repeatedly – is a full and stable ceasefire as a first step towards negotiating a lasting end to Russia's invasion.

But Moscow insists on agreeing the peace deal first, prompting accusations from Kyiv that Russia is not serious about ending the fighting.

There have been several rounds of talks, with the US acting as a mediator, but the process has been on hold since Donald Trump shifted his focus to the Middle East.