Theresa May is battling to keep her Brexit deal alive as she readies to return to Brussels for last minute negotiations.

The prime minister is set to hold more talks with European Commission president Jean-Claude Junker on Saturday in a bid to try and secure a withdrawal agreement at an emergency EU summit scheduled for Sunday.

After talks with Mr Juncker in Brussels on Wednesday night, Mrs May insisted she would press on to attempt to secure an agreement.

She said: “We have made further progress. And, as a result we have given sufficient direction to our negotiators, I hope, for them to be able to resolve the remaining issues. And that work will start immediately.

“I now plan to return for further meetings, including with President Juncker on Saturday to discuss how we can bring to a conclusion this process and bring it to a conclusion in the interests of all our people.”

The move came after reports from Brussels that the Sunday summit could be scrapped.

As the countdown to the scheduled summit intensified, Chancellor Philip Hammond said that if the Brexit deal is rejected by Parliament it would unleash "political chaos" and could lead to EU withdrawal not happening.

He told ITV’s Peston show: “It’s clear that if the deal is not approved by Parliament we will have a politically chaotic situation.

“And, we don’t know what the outcome of that will be.

“And for those who are passionately committed to ensuring that we leave the EU on the 29th of March, 2019, one of the things that they are going to have to bear in mind is the possibility that, in that chaos that would ensue, there may be no Brexit.”

He added: “It could be no deal, but it could be no Brexit, we just don’t know.

“When we look at the economy, and the operation of the economy, getting a smooth exit from the European Union, doing this in an orderly fashion, is worth tens of billions of pounds to our economy.”

The status of Gibraltar has been a thorny issue in talks. Credit: PA

The PM faced a strong push back from Spain over the status of Gibraltar in the “divorce deal”.

Mrs May spoke with her Spanish counterpart Pedro Sanchez on Wednesday evening to try and deal with the situation.

A Downing Street spokesman said: “She said there had been good engagement between the UK, the government of Spain and the government of Gibraltar in order to come to an agreement in the withdrawal agreement and associated package of memoranda of understanding relating to Gibraltar.

“She said that the UK and government of Gibraltar looked forward to these discussions continuing as we discuss the future relationship.

“The Prime Minister reiterated her commitment to agreeing a deal that works for the whole UK family including Gibraltar, the other UK overseas territories and the crown dependencies.”

Before the phone call, Mr Sanchez said his government was “annoyed” that the divorce agreement being prepared for Britain’s exit from the European Union doesn’t specify that Gibraltar’s future must be decided directly by officials in Madrid and London.

Mr Sanchez said the issue is a bilateral matter and is “essential” for Spain.

He repeated his threat that Spain will vote against the planned agreement unless its interests are taken into account.