EU chief Ursula von der Leyen has told the bloc's leaders that there are "low expectations" a post-Brexit trade deal could be struck with Britain, EU sources said.

An EU official on Friday said leaders heard that the "probability of a no deal is higher than of a deal" at a brief discussion of Brexit at a marathon Brussels summit, as time ticks down to a Sunday deadline to make a call on prolonging talks or giving up. 

The pessimistic tone came after British Prime Minister Boris Johnson warned Thursday there was a "strong possibility" of no deal, and instructed his government to prepare for Britain to crash out of the European Union's single market at the end of this year. 

Negotiators from the EU and Britain are carrying on talks in Brussels Friday to see if they can fathom a route to an accord by the weekend cut-off point set by von der Leyen and Johnson at a combative dinner meeting this week. 

An EU official said it would become clear soon if there was any point to prolonging the discussions, but refused to rule out a last-minute "turnaround" in the talks to secure a deal despite the gathering gloom. 

The EU on Thursday published its own contingency plans to keep basic air and road travel running and fishing rights open in the event of no deal, in a move seen as a warning shot to London. 

Britain left the EU on January 31 after five decades of integration but a standstill transition period, under which it remains bound by the bloc's rules pending any new deal, ends on the night of December 31.

Without a post-Brexit deal, Britain's trade with its biggest market would in future operate on pared-down World Trade Organization rules, with tariffs and quotas.

Talks are mainly blocked over the issue of fair competition, with Britain refusing to accept a mechanism that would allow the EU to respond swiftly if UK and EU business rules diverge over time and put European firms at a disadvantage.

Fishing is another sore issue, with Europe eager to keep as much access as possible to the UK's waters.