Although Japan desperately wants Siberian oil and gas, it does not drop its demands.

Begalov became a dominant force in Siberian oil and helped it enter the world market.

Besides Japan's desire for Siberian oil and Russia's interest in Japanese investment, each is looking for an ally in the neighborhood to keep China in check.

The announcement will allow the state-owned pipeline monopoly to proceed with plans to build a pipeline to ship Siberian oil east to Asian markets.

Mr. Koizumi openly appealed for the construction of a 2,500-mile oil pipeline that would bypass China, bringing Siberian oil to the Sea of Japan.

The port of Ventspils lay at the end of a pipeline which brought Siberian oil for export, providing one-third of Soviet hard-currency income.

Siberian oil and gas are the main energy sources not just for Russia but for much of the former Soviet world.

In July, Yukos got approval for a $1.7 billion pipeline that would bring Siberian oil to China.

Sibneft began selling its refined Siberian oil through a network of oil traders.

But in the fall of 2004, Asia's broadest economic shoulders, China and Japan, bumped over a pipeline to ship Siberian oil.