Former PM Boris Johnson has pulled out of the Tory leadership race, saying he had the support needed to stand but it would not be “the right thing to do”.
Former chancellor Rishi Sunak and cabinet minister Penny Mordaunt remain in the contest – with Mr Sunak way ahead on declared support from MPs.
Mr Johnson said there was a “very good chance” he would have been successful, and “back in Downing Street on Friday”.
But he said there needed to be “a united party in Parliament”.
The race began on Thursday after Liz Truss resigned as prime minister after 45 days in the job.
Nominations for the ballot close on Monday afternoon, and candidates need the support of at least 100 Conservative MPs to go forward.
The BBC’s latest tally of publicly declared backers puts Mr Sunak on 155 and Ms Mordaunt on 25.
Mr Johnson had 54, according to this tally – although he said he had 102. Not all of the 357 MPs have gone public with whom they are backing.
It is possible Mr Sunak could become prime minister by Monday, and there will definitely be a new prime minister by the end of the week.
Mr Johnson said he had been attracted by the race because “I led our party into a massive election victory less than three years ago – and I believe I am therefore uniquely placed to avert a general election now.
“A general election would be a further disastrous distraction just when the government must focus on the economic pressures faced by families across the country.”
The next general election needs to take place by January 2025 at the latest. But the new PM – the third this year – may come under increasing pressure from opposition parties to call one before then.
Johnson continued: “I can confirm that I have cleared the very high hurdle of 102 nominations, including a proposer and a seconder, and I could put my nomination in tomorrow.
“There is a very good chance that I would be successful in the election with Conservative Party members – and that I could indeed be back in Downing Street on Friday.
“But in the course of the last days I have sadly come to the conclusion that this would simply not be the right thing to do.
“You can’t govern effectively unless you have a united party in Parliament.”
He said he had reached out to both Mr Sunak and Ms Mordaunt because he had “hoped that we could come together in the national interest – we have sadly not been able to work out a way of doing this.
“Therefore I am afraid the best thing is that I do not allow my nomination to go forward and commit my support to whoever succeeds.
“I believe I have much to offer but I am afraid that this is simply not the right time.”
This is a huge development. I’ve been on the phone tonight to Boris Johnson backers and they were convinced he’d stand. Tonight, confirmation he won’t.
In his statement, Mr Johnson says he thinks he could have won the membership and been in Downing Street by Friday. But he concedes he would struggle to unite his party in Parliament.
The former prime minister says he got 102 backers. We can’t verify this, the public number is lower and we may never know for sure. It’s safe to say many MPs are sceptical he had the number his campaign says.
This all makes Rishi Sunak the firm favourite. But Penny Mordaunt will be trying over the next few hours to win over Mr Johnson’s backers and show she has a significant chunk of Tory MPs behind her.
Expect opposition parties to pounce on the fact Johnson said he was “uniquely placed to avert a general election now”.
Mr Sunak tweeted that “we will always be grateful” for Mr Johnson’s work in office, including the delivery of Brexit and the vaccine rollout.
“Although he has decided not to run for PM again, I truly hope he continues to contribute to public life at home and abroad,” he wrote.
And while Mr Sunak forges ahead as the frontrunner, sources close to the ex-chancellor said “we are not taking anything for granted”.
“Rishi will be continuing to talk to colleagues tomorrow morning before nomination papers go in, and discussing how best to unite the party and take the country forward,” they told the BBC.
Labour’s deputy leader Angela Rayner repeated Labour’s call for an immediate general election.
She said: “The Tories are about to hand Rishi Sunak the keys to the country without him saying a single word about how he would govern. No-one voted for this.
“Perhaps it’s not surprising he’s avoiding scrutiny: after all, he was so bad that just a few weeks ago he was trounced by Liz Truss.”
Mr Johnson became prime minister after winning the election in 2019 but resigned in July after a revolt by cabinet ministers over his leadership.
Liz Truss succeeded him as the UK’s 56th prime minister, claiming victory over Mr Sunak in a leadership contest over the summer.
But her short-lived premiership lasted just 45 days.
She resigned on Thursday following her mini-Budget on 23 September, subsequent economic turmoil and successive government U-turns, triggering the second leadership contest in three months.
