My two cents: The paragraph could use some commas, or parentheses:

The setbacks to the Minsk deal, since the rebels disavowed it by taking a strategic town they said was not covered by the truce, have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.

 

The setbacks to the Minsk deal (since the rebels disavowed it by taking a strategic town they said was not covered by the truce) have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.

My two cents: The paragraph could use some commas, or parentheses:

The setbacks to the Minsk deal, since the rebels disavowed it by taking a strategic town they said was not covered by the truce, have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.

The setbacks to the Minsk deal (since the rebels disavowed it by taking a strategic town they said was not covered by the truce) have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.

My two cents: I think "since" it is used as "because". And the paragraph could use some commas, or parentheses:

The setbacks to the Minsk deal, since the rebels disavowed it by taking a strategic town they said was not covered by the truce, have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.

The setbacks to the Minsk deal (since the rebels disavowed it by taking a strategic town they said was not covered by the truce) have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.

• The rebels disavowed the Minsk deal by taking a strategic town. They justified the taking by saying "the town was not covered by the truce"
• This is a "setback" for the Minsk deal
• This setback has prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine

My two cents: The paragraph could use some commas, or parentheses:

The setbacks to the Minsk deal, since the rebels disavowed it by taking a strategic town they said was not covered by the truce, have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.

The setbacks to the Minsk deal (since the rebels disavowed it by taking a strategic town they said was not covered by the truce) have prompted new calls for U.S. President Barack Obama to give Kiev lethal weapons to defend Ukraine.