Earlier in the day the Russian shareholders in TNK-BP, Russia's third-largest oil company, said they would start legal proceedings against BP, reportedly over management and strategy issues.

BP Chairman Peter Sutherland told reporters in Stockholm: "It is unfortunately a much simpler di

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spute over control, and perhaps ultimately ownership of the company."

"This is just a return to the corporate raiding activities that were prevalent in Russia in the 1990s."

The Russian billionaires controlling Alfa-Access-Renova (AAR), which has a 50% stake in TNK-BP, have demanded a cut in TNK-BP's foreign staff, equal board representation and the replacement of CEO Robert Dudley, who they accuse of putting British oil major BP's interests ahead of TNK-BP.

According to the four main shareholders - German Khan, Mikhail Fridman, Viktor Vekselberg and Len Blavatnik - BP has "persistently ignored" their demands and proposals. They said a compromise is now unlikely.

Sutherland said the Russian leadership is standing by and allowing the tycoons to push forward with their takeover attempt.

"Prime Minister Putin has referred to such tactics as relics of the 1990s, but unfortunately our partners continue to use them, and the leaders of the country seem unwilling or unable to step in and stop them," he said.

The Kremlin has said it does not intend to intervene in the ongoing dispute between Russian and British shareholders.

Analysts have suggested the dispute could result in Russia's third-largest oil company being bought up by state-controlled Gazprom or Rosneft as part of the Kremlin's campaign to toughen its grip on the oil and gas sector.

MOSCOW, June 12 (RIA Novosti)