The heads of the European Union's 27 states held talks in Brussels to chart a way forward between competing goals: to support the bloc's ailing businesses including its cherished car industry, and to play a lead role in the climate fight.

The gathering came with the EU under pressure to agree on their next big emissions target ahead of the United Nations COP30 climate summit which starts in Brazil on November 10.

No final decision was reached -- and none was expected -- but the discussions should provide fodder for a deal within two weeks.

"We reaffirmed our commitment to the Paris Agreement and also agreed that we need to be pragmatic and flexible in our strategy," European Council President Antonio Costa told a press conference, referring to a 2015 UN climate deal.

Thursday's meeting, paired with an earlier letter to leaders by EU chief Ursula von der Leyen outlining planned reforms, "helped create the right conditions" for a 2040 EU target to be agreed on, Costa added.

In July, the European Commission said it wanted to cut emissions by 90 percent by 2040, compared to 1990 levels -- a major milestone towards the overarching goal of reaching net-zero a decade later.

Signatories to the Paris Agreement are supposed to bring a 2035 emissions reduction plan to the Brazil summit, which Brussels was aiming to derive from its 2040 target.

But many businesses complain they are being asked to invest in greening their operations at a time when trade tensions and competition from China are squeezing returns.

- 'Major hurdle' -

A growing number of capitals, in what is an increasingly right-leaning bloc, have been receptive to industry's arguments, culminating in a standoff over the headline figure, which some like Poland and the Czech Republic say is unachievable.

At the summit's conclusion Thursday, EU leaders urged Brussels to include a revision clause in its 2040 proposal to allow future tweaks if needed and to allow countries to count "an adequate level" of carbon credits towards their target.

An earlier commission pledge for credits to account for up to three percent of a nation's emission cuts has failed to persuade hardliners.

Leaders also welcomed steps taken by the commissions to sweeten the pill, including an early review of a 2035 ban on new combustion engine vehicles.

Linda Kalcher, director of the Strategic Perspectives think tank said "leaders crossed a major hurdle" following concerns that discussions could have unravelled amid divisions among member states.

"President Costa managed to rein in populist attempts to weaken existing climate laws or to derail the conversation entirely," she said.

Talks are now set to continue at a lower diplomatic level.

- 'Careful balance' -

"Today's conclusions strike a careful balance between addressing political concerns and providing the steer needed to move forward on key policy decisions," said Elisa Giannelli, of the E3G climate advocacy group.

"However, the strong emphasis on flexibility and simplification must not become a pretext for diluting ambition or delaying implementation."

Behind only China, the United States and India in terms of emissions -- the EU has been the most committed of the major polluters to climate action, having already cut emissions by 37 percent compared to 1990.

Green advocates say more is needed to help stave off the worst consequences of rising global temperatures and persuade laggards to follow Brussels' lead.

Ambition is also crucial for the bloc to draw investments and become a leader in green technologies, avoiding falling further behind China, they say.

"If a robust, resilient, sustainable and innovative economy is our goal, then dogmatically clinging to our existing business models, whatever their past successes, is not the solution," von der Leyen wrote in her letter Monday, urging leaders "to stay the course".