Rafael Benítez conceded for the first time last night that the Barclays Premier League title is slipping away from Liverpool. The Spaniard admitted that if his side are to stop Manchester United equalling their proud record of 18 league titles, victory in the meeting between the sides at Old Trafford on March 14 is imperative.

Another slip-up at Anfield yesterday, in a 1-1 draw against Manchester City, means that Liverpool have won only five of their past 13 Premier League matches, allowing a commanding lead over United — on December 28 they held a ten-point advantage, albeit with United having three games in hand — to turn into a seven-point deficit.

The immediate priority for both clubs is the Champions League, with United visiting Inter Milan tomorrow and Liverpool taking on Real Madrid at the Bernabéu 24 hours later, but Benítez, whose contract negotiations have run into trouble yet again, has said that the faltering title challenge is a cause for serious concern.

“It is a bad result,” the Liverpool manager said. “We can’t change things now and we just have to prepare the teams for the next games, especially in the Premier League. I think we have to beat United now. If we want to reduce the gap, we need to win the next two games and beat United. I have confidence we can beat Middlesbrough and Sunderland and then it will be a different situation. It’s not easy for United to slip up, but there are still 12 games to go.”

The setback against City means that Benítez’s team will travel to Madrid tomorrow with the Champions League again representing arguably their best hope of winning a trophy.

The Premier League has been Liverpool’s overriding priority this season, not least because of the threat posed by United to their record of league titles, but increasingly it looks like a distant dream.

Liverpool’s league slump has coincided with a very public dispute over Benítez’s contract talks, with the manager having surprised the club’s hierarchy by rejecting a fifth draft of the deal. Tom Hicks and George Gillett Jr, the club’s American owners, have bowed to his requests for more control over transfer policy and the youth academy, as well as a wage increase to about £4 million a year. Sticking points remain about the job security of his backroom staff and his concern at the delays in the decision-making process, given the dysfunctional relationship between the owners.

Sources close to Benítez say that he is committed to staying at Anfield and that he is concerned only with ironing out the problems that he believes have made his job far more difficult than it should have been in the two years since the Hicks-Gillett takeover.

Liverpool at least hope to have Steven Gerrard, who failed a fitness test on Friday on his hamstring injury, back in the squad to face Real.

United, for their part, have a personnel crisis in defence, with Nemanja Vidic suspended for the first leg against Inter, Gary Neville and Wes Brown injured and both John O’Shea and Jonny Evans carrying injuries as Sir Alex Ferguson and his team prepare to fly to Milan this morning.