Barnaby Joyce has told supporters he intends to quit the Nationals, won’t run for his seat of New England at the next election, and is “free to now consider all options” – heightening speculation he may switch parties in parliament.

It comes one day after Coalition figures said the former Nationals leader was actively considering defecting to One Nation.

Sky News first reported a statement from Joyce, reportedly sent to party members in his local area, that his relationship with the Nationals leadership had broken down. It went on to say that Joyce would not stand again for New England, but would stay in parliament – presumably on the crossbench – to complete this term, and was considering his options beyond that.

Guardian Australia has not seen the statement, but a Nationals source verified that Joyce had issued a statement announcing his intention to quit the party. Joyce did not respond to requests for comment. The Nationals leader, David Littleproud, is expected to release a statement on Saturday afternoon.

A second Nationals source told Guardian Australia Joyce had spoken to the party’s national executive to announce his intention to sit on the crossbench. It’s understood Joyce has not yet spoken to his party’s leadership.

Other Nationals politicians said they had not been informed about any developments regarding Joyce, and had only heard about the potential via media reports.

There is internal speculation inside the Nationals that Joyce could run for the Senate for One Nation at the next federal election. A One Nation spokesperson on Friday and Saturday declined to comment on speculation and widespread media reporting that Joyce had been in discussions to join the party, but did not deny the claims.

Tensions between Joyce and Littleproud have escalated since the 3 May federal election. Joyce was relegated to the backbench and has been agitating on the issue of net zero by 2050 carbon policies, including introducing a private member’s bill to kill the plan.

From the backbench, the New South Wales MP has campaigned furiously against renewable energy projects, even as the Coalition formally reviews its net zero policy. Joyce crossed the floor to bring on debate in the House of Representatives earlier this year.

More to follow.