Labour is embroiled in an internal racism row after a party source appeared to blame Hamas supporters for a predicted loss in the West Midlands mayoral election.

MPs reacted with fury after a quote appeared from an insider that said a Tory victory in the race would be thanks to “the Middle East, not [the] West Midlands”.

Backbenchers decried the remarks for conflating Muslim voters with Hamas, with the central Labour party later distancing itself from the “racist” comment.

The row erupted after a “Labour source” in the West Midlands predicted that its candidate, Richard Parker, would lose out to Andy Street, the sitting Tory mayor.

“It’s the Middle East, not West Midlands that will have won Street the Mayoralty. Once again Hamas are the real villains,” the source told BBC Midlands Today.

The prediction, made before a single vote had been counted, was seen by Labour HQ as an attempt by local members to preemptively shift the blame onto them.

Birmingham council, which is Labour run, has been forced to slash services and increase council tax by 21 per cent after it was effectively declared bankrupt last year.

The quote sparked fury among the party’s MPs, who said it was wrong to imply that voters who abandoned the party over its stance on Gaza were extremists.

Bell Ribeiro-Addy, the MP for Streatham, said: “This is a disgusting way to talk about Muslim voters, conflating them with Hamas and treating them as a monolith.

“It reeks of racism and entitlement. Such comments should have no place in the Labour Party.”

Zarah Sultana, the MP for Coventry South, added: “Once again I’m deeply disturbed by Islamophobic quotes given to the media by ‘Labour sources’.

“When politicians are confronted with racist bile, it should be immediately condemned. As a party we need to listen to and acknowledge concerns, not hold British Muslims in contempt.”

Tahir Ali, the MP for Birmingham Hall Green, said the remark was “vile racism” and that “treating voters with such a lack of respect is deplorable and should not be tolerated”.

“Such anti-Muslim bigotry will only serve to alienate a community that has long supported Labour in its efforts to transform this country for the better,” he said.

Following the backlash, Labour HQ speedily distanced itself from the anonymous quote and insisted that it did not represent the party’s views.

A spokesman said: “The Labour party has strongly condemned this racist quote which has not come from anyone who is speaking on behalf of the party or who’s values are welcome in the party.”

The row put a dampener on Sir Keir Starmer’s day as he celebrated a series of thumping victories over the Conservatives in council elections across the country.

Across the country, Labour secured a swing that would be enough to comfortably propel it into power if replicated at the general election later this year.

Among the good results, insiders watched with disquiet as evidence emerged that Musim voters were deserting the party over Gaza.

Labour suffered in areas like Oldham and Bolton, with local activists blaming Sir Keir’s initial stance on a ceasefire in Gaza for alienating traditional supporters.