Brexit talks on a knife edge as EU leaders start summit

The British prime minister will decide after an EU summit concludes on Friday whether to walk away from the talks based on whether he thinks the bloc is determined to reach a deal or not.

The two sides barely made any progress this week, and the EU is no longer as confident as it has been in recent weeks that Johnson won't carry out his threat to abandon the discussions, two EU officials said.

"If conditions aren't met, it's possible we won't have an agreement," French President Emmanuel Macron said as he arrived at the meeting. "We are ready for that."

The summit -- at which the U.K. isn't represented -- will see leaders stick to their line that Britain has to make further concessions before talks can enter their intensive final phase, something the U.K. government has already rejected.

For EU negotiators, the gathering will also be a balancing act between countries like France, which is reluctant to compromise on fisheries -- one of the main obstacles to a deal -- and other member states which don't want to risk the talks collapsing.

On Wednesday night, Johnson told European Commission President Ursula von der Leyen he was "disappointed" by the lack of progress in the negotiations.

Johnson met with his chief negotiator, David Frost, who returned to London on Thursday morning, according to Downing Street spokesman Jamie Davies. A person familiar with the discussions said earlier that Frost was set to advise the prime minster to remain in the talks for at least two more weeks because a deal is still possible.

That may not be enough for the prime minister who wants EU leaders to demonstrate that they are ready to inject energy into the process and tell their negotiators to work round the clock over the next two weeks.

The latest draft of Thursday's summit conclusions doesn't reflect any intention to do that. It merely calls on chief negotiator Michel Barnier to "continue" talks, rather than "intensify" them, as an earlier draft said.

The new wording shouldn't be seen as a toughening of the EU's position, but an attempt to balance the competing positions of the 27 governments, an official from the bloc said.

"The situation is too serious to get caught up on this or that word," Dutch Prime Minister Mark Rutte told Bloomberg Television. "Come January, I don't think citizens are going to care whether in some summit the word was speed up, intensify or continue."

Resolving the two sides' disagreements over fisheries and business subsidies will be key to securing a deal. Without one, millions of businesses and consumers will have to grapple with additional costs and disruption after the U.K. leaves the EU's single market and customs union on Dec. 31.

"We want a deal, but not at any cost," German Chancellor Angela Merkel said as she arrived at the talks in Brussels. "It must be a fair deal."

The process is now becoming as much of a negotiation between the EU's 27 national governments -- especially between the powerhouses of Germany and France -- as it is between the EU and Britain, as the bloc works out what sort of deal it can live with, one European diplomat said.

Macron's demands to maintain his country's current access to British fishing waters are now the biggest roadblock to a deal, to the increasing frustration of his European allies.

In a thinly veiled attack on the French position, a German government official said on Wednesday that once interested European coastal nations realize that the alternative to no deal is no access to British fishing grounds, there could be increased flexibility.