The Brussels diplomat has told a private meeting of EU27 ambassadors that there may not be a trade agreement with Britain in place by the end of the year. He also revealed that the three main sticking points – fishing rights, common standards, including state aid, and governance – are still blocking progress. Mr Barnier debriefed the EU envoys on the state of play in the negotiations from London where he is currently locked in intensive talks with UK counterpart Lord Frost.

Sources say the two sides have been working around the clock in an attempt to break the current deadlock.

But it has emerged they are still far apart on the most contentious issues of fisheries and the so-called level playing field.

An EU diplomat said: “Differences still persist on the three main issues.

“A deal still hangs in the balance.”

The pound slumped on the news, weakening by as much as 0.5 percent against the dollar – to below $1.34.

And the pound also hit a near-month low against the euro. 

Mr Barnier was ordered to hold the meeting by European capitals concerned he could offer too many concessions to get a Brexit trade deal over the line.

Diplomatic sources said the near-radio silence from the wrangling over a UK-EU trade agreement had unnerved some EU states. 

Last night, a source told “The main question is will what Barnier and Frost negotiate stand up in capitals?

“States are becoming more nervy as they receive less information from the talks.”

The source added: “To make that gap some large concessions are required and it remains to be seen whether some EU capitals are going to sell those back home.”


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