"We hope that this will be the last round and that by December 5 we will have agreed a new accord," said Russian foreign ministry spokesman Andrei Nesterenko.

"Both sides are aware of the responsibility they have shouldered and are doing everything to achieve the necessary results. There is progress."

Negotiations on the landmark 1991 Strategic Arms Reduction Treaty (START) had largely stalled under George W. Bush's presidency.

However, Barack Obama's arrival in the White House and his recent announcement to scrap missile shield plans in eastern Europe have lent fresh impetus for negotiations to move forward.

A Kremlin source quoted in the Russian press said the two Cold War foes are even planning to sign the accord before Obama receives his Nobel Peace Prize on December 10, marking a major foreign policy achievement for the US leader.

Signals from Moscow have been largely positive, with Russia saying on Thursday that the latest US proposal on START was "constructive."

Washington has been comparatively mum on the subject, but it too said in October that there had been "progress" in the marathon negotiations.

Following a visit to Moscow by White House national security adviser James Jones, Russian newspaper Kommersant reported that the parties have found compromise on two key points.

Those areas involve limits on the numbers of ballistic missile carriers and the way in which the new treaty should address the issue of anti-missile defence.

A major issue hampering progress in negotiations has been Moscow's insistence for the new deal to impose deep cuts in the number of carriers capable of delivering nuclear warheads.

"Lower limits must be set on the number of strategic carriers. This means ground-based intercontinental ballistic missiles (ICBM), submarine launched ballistic missiles (SLBM) and heavy bombers," said Nesterenko on Friday.

"The treaty must also adequately reflect the linkage between strategic offensive and defensive weapons. This is extremely important since it will make up for the absence of an agreement on a missile defence shield."

Observers were positive on the negotiations.

"I think it is fully possible to conclude a treaty by the end of the year," said Vladimir Dvorkin, a retired Russian general who is now an expert at the Centre for International Security in Moscow.

"I think there are still problems related to verification systems -- inspections and confidence measures -- but a solution to them is possible," added Dvorkin, a former Soviet arms control negotiator who took part in the original START talks.

At a Moscow summit in July, Obama and his Russian counterpart Dmitry Medvedev agreed to each reduce their nuclear arsenal to between 1,500 and 1,675 warheads within seven years.

They also agreed cuts on the number of ballistic missile carriers to between 500 and 1,100.

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