MOSCOW—Ukraine suffered heavy losses in a counterattack along a key supply route to the separatist capital of Donetsk, officials said Thursday, underscoring the significant threat posed by pro-Russia rebel fighters despite steady advances by government forces.

Losses have mounted recently, adding more pressure on Kiev to seek a compromise at peace talks next week in the Belarusian capital of Minsk, where Ukrainian PresidentPetro Poroshenko and Russian leader Vladimir Putinare scheduled to meet face-to-face for the first time...