Glencore's proposed $30 billion takeover of Xstrata has come a step closer to collapse, as the commodities trader looked set to let slide an informal deadline for it to raise its offer and yield to rival shareholder Qatar.

While it is not the final death knell for one of the largest ever proposed deals in the sector, analysts, investors and sources involved in the talks said the fact Glencore and Qatar continued to stare each other down - with only two weeks to go before shareholders vote - had put the deal on the brink.

'It wouldn't be illogical to say this is 10 per cent happening, 90 per cent not happening,' one source involved in the negotiations said on Friday.

'If you were laying bets, you'd have to say this isn't going anywhere. It is not clear what the Qatari game is.'

Glencore listed last year, in large part to complete ambitious deals like a merger with Xstrata, in which it already owns 34 per cent. The world's largest diversified commodities trader made its move in February, offering 2.8 new shares for every Xstrata share held.

The long-awaited bid was thrown into question in June, however, when Qatar Holding, Xstrata's second-largest shareholder as a result of regular buying in the market since February, said it was demanding 3.25.

The unexpected twist means two sides have engaged in what advisers on all sides have likened to a 'game of chicken', with Glencore warning, most forcefully and most recently on Tuesday, that it would stick to its offer.

Qatar, for its part, has made no public comment, but has continued to buy Xstrata shares and sources say the sovereign wealth fund is showing no sign of yielding yet. It now owns over 12 per cent.-Reuters