Petrescu, who joined two years ago after leading Unirea Urziceni to the Romanian title, has guided promoted Kuban into the champions group, the second phase of the Russian season.
"I've heard a lot of praise for our players this year but I'm really convinced our best player is Dan Petrescu," general director Suren Mkrtchyan told the team's website.
Kuban said the new contract included improved terms for Petrescu at the club from Russia's south.
Petrescu, who turns 44 next month, said earlier this year that he was committed to Kuban for at least another two seasons but he also hoped he could return to Chelsea some time in the future.
"I will never forget the time I spent at Stamford Bridge so my dream is to return there as coach or manager one day," he told Reuters.
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