LONDON - US President Barack Obama and Russian leader Dmitry Medvedev on Wednesday agreed in a joint statement to launch talks on potentially far-reaching reductions of their nuclear arsenals.

"The Presidents decided to begin bilateral intergovernmental negotiations to work out a new, comprehensive, legally binding agreement on reducing and limiting strategic offensive arms to replace the START Treaty," the two leaders said in their statement.

"The United States and the Russian Federation intend to conclude this agreement before the Treaty expires in December."

Medvedev and Obama, who met in London ahead of Thursday's G20 summit, also said that they had agreed on the long-term goal of a "nuclear free" world.

The Cold War-era Strategic Arms Reduction Treaty (START) signed between the Soviet Union and the United States expires in December 2009, and Moscow and Washington have been seeking to thrash out terms of a new accord.

The 1991 treaty limits the number of missiles and warheads that each side may have and is a cornerstone of Cold War strategic arms control.