We're facing months under a caretaker government
Kenny attempts to buy time for his leadership, Fianna Fáil will propose Martin for new Taoiseach
The country will be run by a caretaker government for months as Fine Gael and Fianna Fáil struggle to deal with the fallout of an unprecedented election result.
The deposed coalition, including ministers who were dumped by voters, will meet as early as tomorrow to discuss how to continue in power despite their losses.
Environment Minister Alan Kelly's passionate reaction to being re-elected was a rare moment of jubilation on what was a dire day for the Labour party.
Members now face a tense wait in Dublin Bay north in on a result which will determine if the party ends the election with six or seven seats.
The party needs seven seats to hold automatic speaking rights in the Dail.
A stalemate situation is developing as Taoiseach Enda Kenny attempts to 'buy time' for his leadership, and Micheál Martin assesses whether he should risk supporting a minority government. Both parties accept that a new government will not be formed by the time the Dáil meets on March 10.
Mr Kenny and Tánaiste Joan Burton spoke by phone yesterday and agreed to hold an urgent Cabinet meeting that will include James Reilly and Alex White, who have lost their seats.
Fianna Fáil sources say Mr Martin is in "no panic" to talk with other parties about potential coalition options, although it is likely that he will be proposed as Taoiseach when the first Dáil convenes.
His party has more than doubled its seats but will still be about 10 seats behind Fine Gael once all the ballots are counted.
"We will wait until the dust settles. It's a really good result for Fianna Fáil but the onus is still on Fine Gael to make the first move. The obligation is on them," said one party source.
Together, Fine Gael and Fianna Fáil will have more than the 80 seats needed for a coalition, but working together will be difficult for both parties.
Speculation is also rife within Fine Gael that Enda Kenny's term as leader of the party is coming to an end after a disastrous result that saw them lose more than 20 seats.
He has indicated that he will remain on as Taoiseach in the national interest until a new government is formed.
Ms Burton said she would support the re-election of Mr Kenny as Taoiseach if that was proposed on March 10 - but acknowledged that deadlock was likely.
In that event, President Michael D Higgins may request the outgoing government to stay on for a further period of time until a government can be formed.
Fine Gael's director of elections Brian Hayes told the Irish Independent that coalition talks would take months. "This is going to be a very complicated, slow but public process over the next few months," he said.
"The Irish electorate have thrown up a result that we now have to interpret and understand.
"We said we wouldn't go in with Fianna Fáil, they said they wouldn't go in with us. That is the de facto position so if people are going to move from positions like that, it's going to take time."
Mr Hayes said Fine Gael had lost the election and there was now a "fundamental responsibility" for all parties to talk to each other.
"I'm very much opposed to this idea that we can in some way go back to the electorate and say 'let's have another election please because we don't like the result'. That's utter nonsense. The people have spoken," he said.
Fianna Fáil were keen to play down the idea of a 'grand coalition' with Fine Gael, which Mr Martin repeatedly ruled out during the election campaign.
The party's General Secretary Sean Dorgan said "enormous difference" existed between the two parties and politicians needed to "assess what's happened".
"There's a very clear message being sent from the electorate, parliament now needs to take its responsibility very seriously.
"The days with a massive majority are over," he said.
"We're Europeanising our government. I think Micheál Martin will be proposed as Taoiseach on March 10 but it's not as simple as two plus two is four."