BRUSSELS -- Foreign Minister Andrei Kozyrev on Wednesday held out the possibility that Moscow might drop its opposition to lifting an arms embargo against Bosnia's Moslems if Bosnian Serbs reject a peace plan nearing completion. Kozyrev, meeting reporters after talks with U.S. Secretary of State Warren Christopher, was asked if Russia would agree to end the arms embargo, which has helped to keep Moslems at a military disadvantage in confronting the Serbs in Bosnia. "Nothing is excluded from examination right now," Kozyrev said. But he added that more progress was needed in discussing options on incentives and penalties that Washington, Moscow and the European Union might apply to make the combatants accept a peace plan and map for Bosnia currently being drawn up by those parties. Christopher said the "contact group" of senior officials working on the peace plan would meet again on June 28 to try to make final decisions on what he called "carrots and sticks" that would be used to pressure the Bosnian factions. If that meeting is successful, foreign ministers will meet to approve the plan, he said. "We've made good progress in developing a common approach," he added. Christopher, who arrived in Brussels late Tuesday, told reporters traveling with him that U.S., Russian and European negotiators were very close to an agreement on the peace plan that would soon be presented to the Serbs, Moslems and Croats. He said a major issue to be discussed with Kozyrev was penalties and inducements that could be used to persuade any reluctant combatants to accept the peace plan. He added: "We are not very far from agreement on that, as well." The peace plan would give 51 percent of Bosnia to Moslems and Croats and the remaining 49 percent to Serbs, who now control about 72 percent of the territory. Russia, where many people share an ethnic and cultural identity with Bosnian Serbs, has tried to protect Serbs whenever possible from international condemnation and NATO air strikes. Some experts predict the U.S.-Russian-European unified peace plan for Bosnia will fail and could fan tensions with Moscow, especially if Serbs reject the plan and a move is made to end the UN arms embargo on the Moslems. Fighting continued on the ground but Christopher said the situation in Bosnia was far better than at any time since President Bill Clinton took office in January 1992. Christopher refused to specify proposals for exerting pressure on the Bosnian factions to accept the plan. There had been speculation that foreign ministers from the United States, Russia, Britain and France might meet in Geneva this week to approve the peace plan. Christopher said that would not happen this week. Christopher, told by reporters that neither Bosnian side seemed inclined to accept the plan, said: "We haven't seen whether or not the parties are willing."We remain of the view that we should not coerce the parties into joining but I think when each of the parties looks at the proposal and looks at the consequences of not participating, we hope they will recognize it as a fair approach. And we hope they will see the advantages of peace and reconstruction of their country," he said. ?