The European Union is preparing “countermeasures” against the United States if the two sides cannot reach a deal after surprise U.S. tariffs on steel rattled global markets and complicated the ongoing negotiations between Brussels and Washington.

The European Commission said on Saturday that Europe was prepared to retaliate against President Donald Trump's plan to double tariffs on imported steel and aluminum, raising the prospect of an escalating trade fight between two of the world's largest economic powers.

The EU has said it "strongly" regrets Donald Trump's surprise plan to double US tariffs on steel and aluminium in a move that risks throwing bilateral trade talks into chaos.