With 99 percent of votes counted by 11:45pm (21:45 GMT) on Sunday, the conservative opposition People’s Party (PP) had 136 seats while Prime Minister Pedro Sanchez’s ruling Socialist Workers’ Party (PSOE) had 122 seats.

Parties with the greatest potential to be kingmakers were nearly even with the far-right Vox part on 33 seats and far-left Sumar on 31.

The outcome for Vox, which had campaigned on a platform of rolling back laws on gender violence, LGBTQ rights, abortion and euthanasia, marks a loss of 19 seats from four years earlier.

While Sanchez’s Socialists finished second, they and their allied parties celebrated the outcome as a victory since their combined forces gained slightly more seats than the PP and the far-right.

The bloc that could likely support Sanchez totalled 172 seats, while the right bloc, behind PP’s leader Alberto Nunez Feijoo, was likely at 170.

Al Jazeera’s Sonia Gallego, reporting from Madrid, said Spain “once again, finds itself in political limbo”.

“And there is no sign as to exactly which direction the country is headed, whether it’s with the vision of Mr Sanchez or whether it will all change under a government headed by Mr Feijoo,” she said.

The closer-than-expected outcome for the two blocs was likely to produce weeks of political jockeying and uncertainty over the country’s future leadership.

Negotiations to form governments will start after a new parliament convenes on August 17.

Sanchez described Sunday’s outcome as a defeat of the far-right.

“Spain and all its citizens who voted have been absolutely clear,” he told a jubilant crowd gathered at the Socialists’ headquarters in Madrid. “The backwards-looking bloc that wanted to roll back all the progress we made over the past four years has failed.”

Sanchez had called the snap polls in late May after his Socialist party and its far-left junior coalition partners suffered a drubbing in local and regional elections in which the right surged.

He focused his campaign on warning about the danger of a PP-Vox government to mobilise the electorate. The strategy appears to have paid off, with turnout reaching almost 70 percent, some 3.5 percentage points higher than in 2019.

‘Divided country’

Feijoo, who took over as head of the PP in April 2022, had focused his campaign on promising to “overthrow Sanchismo” a derogative term for Sanchez’s policies.

In remarks after the count, the conservative opposition leader said he would push for the chance to form a government as the party with the most votes.

“As the candidate of the party that won the most seats, I believe it is my duty to try to form a government,” he told supporters outside the PP headquarters in Madrid.

To do so, Feijoo could try to persuade smaller parties to back a PP-Vox coalition. But many appear reluctant to support the ascent of a far-right party into power for the first time since the four-decade rule of dictator Francisco Franco, who died in 1975.

The Basque Nationalist Party (PNV) said before the election that it had no agreement with PP and Vox while Teruel Existe told El Pais it would not support such a coalition.

While Sanchez has more options for negotiations, he may still struggle to cobble together a majority, with potential allies looking for concessions in return for their support.

In the present scenario, Sanchez’s PSOE would rely heavily on Catalan separatist parties, the Junts and ERC or Basque separatists EH Bildu. If Junts asks for a referendum on independence for northeast Catalonia, that would likely be far too costly a price for Sanchez to pay.

“We won’t make Pedro Sanchez prime minister in exchange for nothing,” Miriam Nogueras of Junts said after the results left her party holding the keys to power.

Santiago Abascal, the leader of Vox, meanwhile said that the Socialists’ results were “bad news for Spaniards”.

“Pedro Sanchez, despite losing the elections, can block [Feijoo’s] investiture and, even worse, Pedro Sanchez could even be invested with the support of communism, the coup-seeking separatism and terrorism, all of whom will now have more leverage in the blackmail than in his previous term,” he told supporters.

Hung parliaments have become the norm in recent years due to the fragmentation of Spain’s politics and the emergence of new parties challenging the dominance of the PP and the PSOE.

The country held two elections within six months in late 2015 and 2016, after which there was a 10-month standoff until the Socialists finally agreed to abstain from a confidence vote to allow the PP to form a minority government.

In 2019, two more elections were held before the PSOE and far-left Podemos agreed to form Spain’s first coalition government.

Pablo Calderon Martinez, a professor at Northeastern University, told Al Jazeera Sunday’s outcome revealed a “divided country”.

“The Socialist Party has overperformed slightly, while the right-wing bloc has perhaps underperformed, which means that we pretty much have a very divided country. It’s going to be interesting to see how they negotiate the next government,” he said.