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Barack Obama today claimed he never threatened to 'punish' Britain for leaving the EU as he warned we are still at the back of a queue for a US trade deal.

Speaking after his first summit with new PM Theresa May, President Obama said a trade deal with the UK is not Washington's top priority as it is already negotiating mega-deals with the EU and Pacific countries.

And the US President defended his infamous warning from April that Britain would be 'at the back of the queue' for a trade deal if we left the EU.

“I never suggested we would 'punish' Great Britain,” Obama said.

“My simple point is that we have put great priority on first the Trans-Pacific Partnership; that we are also negotiating effectively with the entirety of the EU around TTIP, and those negotiations are proceeding.

(Image: REUTERS)

“And so it would not make sense for us to put those efforts aside.”

Standing alongside Mrs May after one-to-one talks at the G20 summit in China, Obama made clear he still believes Britain was wrong to vote to leave the EU.

And he warned economic ties between the UK and US could 'unravel' without careful diplomacy.

"It is absolutely true that I believed pre-Brexit vote - and continue to believe post-Brexit vote - that the world benefited enormously from the UK's participation in the EU,” the President said.

(Image: Getty Images)

"But I also said at the time that ultimately this was a decision for the British people. And the British people made that decision."

Showering praise on Mrs May as a “steadying hand” in Downing Street following the shock of the Brexit vote, the President – who leaves office for good at the end of the year - said the US would work with Mrs May to mitigate any fall-out.

"We will consult and co-ordinate with her as she and her government move forward with the Brexit negotiations to ensure that we don't see adverse effects in the trading and commercial relationships between the US and the UK," he said.

(Image: REUTERS)

"We are going to do everything we can to make sure the consequences of the decision don't end up unravelling what is a very strong and robust economic relationship - and could become even stronger in the future.”

Mrs May suggested preliminary trade discussions took place during the hour-long talks and vowed to “seize the opportunities” of Brexit.

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She said: "The UK has always been a strong partner for the US and that will remain the case."

She added: "We are both strong supporters of free trade and today we have discussed how to take forward consultations to ensure that the UK and US have the strongest possible trading relationship.

"This reinforces my belief that as we forge a new global role for the UK we can and will seize the opportunities that Brexit presents and make a success of it."