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I am now on a 2-core VDS with Ubuntu 16.04 but unable to upgrade the latest security updates. It was working flawlessly yesterday before I up'd it from a 1-core to a 2-core. I tried several times and each time get the following....
Have you also tried "apt-get dist-upgrade"? It does a bit more in terms of what it changes.
(As a separate note, since you are logged in as root, you shouldn't need the "sudo" at the beginning, which also would only apply to your first command.)