Analysis By Nick Assinder Political Correspondent, BBC News website

When Peter Mandelson was "sent to Europe" it was widely claimed Chancellor Gordon Brown was delighted.

Mr Mandelson wants Britain in the euro

The man who had abandoned him at the last minute in the Labour leadership contest was out of his hair.

Yet it is now being claimed - and fiercely disputed by Downing Street - that the prime ministerial knives are out for the chancellor and Mr Mandelson, while appearing to be supportive of the chancellor, is actually undermining him.

It was always highly unlikely that Mr Brown was so easily pleased as to believe making Mr Mandelson a European commissioner would mark a sea change in their relationship.

It was far more likely he was simply relieved the prime minister had not brought Mr Mandelson back into the cabinet.

He may even have issued veiled threats of a monster sulk if his old friend-turned-enemy was rehabilitated in that fashion.

End feud

But the chancellor is canny enough to know that a move to Brussels would not necessarily be enough to end the feuding between them.

Indeed, having Mr Mandelson as an EU commissioner with the single currency and EU constitution still on the British political agenda, no matter how vaguely, was always going to provide a point of conflict.

Blair and Brown claimed still to be at odds

And so it appears to have turned out.

On two occasions recently, Mr Mandelson has suggested he wants to end the feud between them.

First, earlier this year, he said Mr Brown was the "natural successor" to Tony Blair.

Now he has openly declared his desire for Mr Brown's backers - for which we can read the chancellor himself - to "draw a line" under the rift between them.

But nothing is ever that simple in politics or personal relationships and, sure enough, Mr Mandelson's comments contained what many interpreted as a barb.

He said the Treasury had misrepresented him by accusing him of attacking the chancellor for "gloating" over Britain's economic record.

And he described the on-going rift as "parochial" and said it did not benefit the government or the national interest.

Fed up

Most recently of all, he told French newspaper Le Monde that Britain should set a date for joining the euro.

That is not the sort of thing likely to win over the chancellor, although it will play well with his new EU colleagues. And, it must be said, it is his well-known position.

It is a fair bet this three-cornered feud will not go away - unless blood is spilt.

And this is a division which is bound to run and run, particularly at a time when the UK is about to hold the presidency of the EU.

What is even worse for the chancellor, however, is the suggestion in Westminster and reported in the Sun newspaper that the prime minister has decided to sack Mr Brown after the election, assuming he wins it.

Mr Blair is said to be fed up with a lack of support from the chancellor and will offer him the job of foreign secretary on a take-it-or-go basis.

Relations between the two men have never been good but appear to have taken another nosedive of late.

It has now reached a point where Downing Street has been asked whether the prime minister was using Mr Mandelson as part of a campaign to undermine Mr Brown.

That has been denied, but some things never change. And, on that basis alone it is a fair bet this three-cornered feud will not go away - unless blood is spilt.