UKIP is reckoned to have cost the Tories around 20 parliamentary seats at the last general election, and its strong showing in recent special elections suggests it could be an even bigger threat in 2015. Cameron may today have done enough to win back much of the support he’s lost to UKIP, although its leaders are insisting that they’ll continue to campaign for a straightforward exit from the EU, and claim that Cameron will backtrack on his commitments if he’s re-elected.

Cameron’s announcement has also put the pro-EU Labour party on the back foot. Labour’s cynically opportunist leader, Ed Miliband, has for the last couple of years sought to exploit Tory divisions over Europe while refusing to outline his own party’s position. He has, however, said in the past that he’s against a referendum, and might now be forced into a humiliating U-turn in a bid to steal Cameron’s thunder.

European leaders, meanwhile, are desperate to head off any British renegotiation, fearing that other countries would follow suit – which would spell the end for their grandiose plans for “ever-closer union.” They’ve warned Britain that it cannot “cherry pick” the terms of its EU membership, and insist the UK must be “all in or all out.” A sign of their desperation is the fact that they’re citing President Obama’s eagerness for Britain to remain in the EU as some kind of deal-breaker.

For all their bluster, however, Europe needs Britain rather more than Britain needs Europe. The value of British exports to the eurozone is falling steadily, even as the UK increases trade with the rest of the world, and Europe sells rather more to Britain that it sells to Europe. It may turn out to be a matter of who blinks first.

There’s not much point in speculating on the details of the proposed negotiations, or the outcome of a referendum, before the 2015 election (as Ambrose Evans-Pritchard writes in the Telegraph, given the ongoing eurozone crisis it’s possible that a referendum on Britain’s future may not even be necessary). But if the UK’s modest recovery from recession continues (unemployment fell again today, while it continues to hit record highs in the eurozone), the Conservatives’ position as the only party offering the British people a say on Europe will put them in a strong position to win an outright majority.

Then the fun will really begin.