A deal appears to be in sight for the final day of the UN climate change talks but there are fears it may not prevent a 3C (5.4F) temperature rise. Denmark's prime minister spoke of "very fruitful" talks as Copenhagen prepared to receive US President Barack Obama and 118 other world leaders. Both the US and China, the two largest emitters of greenhouse gases, have indicated they may make concessions. It is hoped these may help overcome sharp divisions at the two-week talks. China signalled concessions on the monitoring of emission curbs while the US said it would commit money for developing countries. Denmark's Lars Lokke Rasmussen called late-night talks with a group of 26 influential world leaders on how to unblock negotiations. "We discussed how we can make progress and we had a very fruitful, constructive dialogue... for almost two hours," he told reporters. After the leaders left, their aides continued working on a political agreement for them to inspect later. "We tried to find an umbrella political accord, if you like," said Swedish Prime Minister Fredrik Reinfeldt, who also holds the rotating presidency of the European Union. "We tried to advance the main points and have asked the 'sherpas' to work on the text through the night so we can discuss them tomorrow morning." In another development, President Obama may reach an agreement in principle on nuclear arms reduction with his Russian counterpart, Dmitry Medvedev, when they meet in Copenhagen on Friday, a senior US official said. Important concessions Despite many expressions of concern about projections of climate change, finance has emerged as an issue more likely to make or break a deal than emission pledges, the BBC's Richard Black reports from Copenhagen. US Secretary of State Hillary Clinton said her administration was prepared to help establish funding of $100bn a year for developing countries if a deal emerged that met US requirements. The key US demand is "transparency" from China, seen as a must if the US Senate is to pass legislation controlling emissions. While Beijing has been hostile to this notion, Chinese Vice Foreign Minister He Yafei said China was ready to engage in "dialogue and co-operation that is not intrusive, that does not infringe on China's sovereignty". There was no immediate reaction from the US delegation to the Chinese offer but, an Associated Press correspondent reports, it went a long way toward meeting American demands. Earlier, Indonesia's President Susilo Bambang Yudhoyono called for all states, both developed and developing, to be flexible about verification. He indicated the possibility of setting up an international mechanism for monitoring emission cuts. Emissions gap The draft declaration is reportedly set to mention a cap of 2C but a document prepared by the UN climate convention secretariat, which was leaked earlier, confirms that current pledges on cutting greenhouse gas emissions are almost certainly not enough to keep the rise in the global average temperature within that level. The analysis says that to achieve that goal, global emissions should be kept at or below 44 gigatonnes (Gt) of carbon dioxide equivalent (CO2e) in 2020. But if enacted, the current maximum pledges from developed countries would leave emissions 1.9Gt above that figure; minimum pledges would mean missing the target by 4.2Gt. Unless this gap is closed, it says - for example by developed nations raising their current overall offer to a cut of 30% from 1990 levels by 2020 - global emissions will "remain on an unsustainable pathway that could lead to concentrations equal or above 550ppm, with the related temperature rise around 3C". The analysis was based on a number of recent studies, notably the International Energy Agency's World Energy Outlook. "The stark message for world leaders at Copenhagen is that the proposals on the table - especially from industrialised countries - fall far short of what the world needs," said Keith Allott, head of climate change for WWF in Britain. Source: bbc