The BBC’s interview with Peter Mandelson had offered ample evidence of the Labour peer’s “formidable political brain”, according to Louis Mosley, UK head of the US data firm, Palantir Technologies.

An indefensible error of judgment had been made by Mandelson, Mosley said in a panel discussion with Laura Kuenssberg after the airing of some of the 30-minute interview on her Sunday morning political show, but “he is a masterful interpreter of Trump and we now live in a world where that man will determine much of what happens, and we need people who can be that translation function”.

The capacity of Lord Mandelson for network building is undoubted. The former Labour cabinet minister’s fairground ride of a career suggests it is both his superpower and his kryptonite.

He was withdrawn last September as US ambassador after emails emerged detailing his close relationship with the billionaire serial sex offender Jeffrey Epstein. They revealed that he had advised his “best pal”, as he described the American in 2003, to “fight for early release” on the eve of his sentencing in 2008 for soliciting prostitution and procuring a person under the age of 18 for prostitution.

Mandelson’s tendency to be drawn like a moth to a flame to those with power and wealth had let him down again. But Downing Street insiders say Mandelson had been appointed ambassador in the first place – despite the serious reservations of many, including the prime minister – thanks in large part to another relationship he had built with a quite different character, Keir Starmer’s chief of staff, Morgan McSweeney. “Mandelson was a mentor to him,” said one insider.

As it happens, Palantir’s Mosley, the grandson of Oswald Mosley, leader of the British Union of Fascists in the 1930s, is no stranger to Mandelson’s charms either. Palantir was for years a client of Global Counsel, the strategic consultancy co-founded by Mandelson. During Mandelson’s time as Britain’s ambassador in the US, Mosley and Palantir hosted Starmer at the company’s Washington offices.

So for all of the condemnation and humiliation, Mandelson, 72, still has admirers, and the drive to go again, even if he has said that he knows public service is a thing of the past. “Who knows what’s next,” Mandelson told Kuenssberg. “I don’t know what’s next. I’m not going to disappear and hide – that’s not me.”

Mandelson, who had already notched up two controversy-shrouded cabinet resignations before his latest dramatic fall from grace, had described himself as the “eternal comeback kid” after his appointment as Britain’s man in Washington.

Does he really believe he can secure the role of elder statesman again? If Mandelson’s article about Venezuela in Michael Gove’s Spectator magazine and interview with the BBC were attempts at that, they were not sure-footed ones.

During the interview, Mandelson was pressed to apologise to Epstein’s victims. “If I was complicit or culpable, of course I would apologise, but I was not culpable, I was not knowledgable about what he was doing and I regret, and I will regret to my dying day, the fact that powerless women who were denied a voice were not given the protection they were entitled to expect from the American system.” The line was never likely to hold.

Among those who condemned the interview was Ayesha Hazarika, a former Ed Miliband press adviser, who described it as a “slap in the face to Epstein victims”. By Monday evening, an apology was delivered. “I was wrong to believe him following his conviction and to continue my association with him afterwards,” Mandelson said. “I apologise unequivocally for doing so to the women and girls who suffered.”

In Westminster, the statement confirmed to some the suspicion that Mandelson struggled to apply his media expertise to his own life. “What on earth was Peter playing at?” asked one cabinet minister. “Why would he go on TV on Sunday and then not apologise? It’s totally mad. He needs to disappear for a very long time.”

A second cabinet source said: “Peter managed to create several days of headlines on his relationship with Epstein by failing to apologise. He just doesn’t get it. It’s been damaging for Keir. It just reminds everyone that he appointed him.”

Why did Mandelson not apologise to the women in the first instance? One person familiar with his thinking said that Mandelson did not want to “bracket” himself “by implication with those who either participated in Epstein’s grooming activities or simply knew about them and chose to ignore them”.

He had made a “split-second judgment” in how to frame his apology in the BBC interview. He felt strongly that people had covered up for Epstein, that “money and power protected Epstein rather than those he preyed on”, and wanted to say so, the source said. Mandelson became concerned though that his comments were being perceived as him “shunning any personal responsibility for not believing the women”. That, he did not want to do – and so he made his statement and felt happier after he had done it.

Another source suggested the initial lack of an apology was likely linked to the Labour peer’s experience of being a gay politician of “a certain generation”. “There is a real sensitivity about the idea that he could be in any way complicit in the sexual abuse of young people which he wasn’t,” the friend said. “I think the old spin doctor in him didn’t want headlines of ‘Mandy says sorry for paedo friend’.

Of Mandelson’s recent frame of mind, the source went on: “He has been in a pretty bad way – there have been tears.”

It has been one mess after another. Soon after his return to the UK, Mandelson was forced into an embarrassing apology after being photographed urinating against a wall outside George Osborne’s Notting Hill home after dinner with the former Tory chancellor. “The night had to end a little early as Osborne’s kid had fallen ill and then Peter didn’t want to disturb them further by knocking to use the toilet while he waited for an Uber,” said a friend.

He appears to have taken the blows quite personally. “The 5am call to the ambassador’s residence telling him he was being withdrawn was on Reinaldo’s birthday,” said a source in reference to Mandelson’s husband, Reinaldo Avila da Silva. “Peter is very cross with a few people. He is pretty cross with Keir.”

One point that is particularly sore, say friends, is that he was not given an opportunity before being withdrawn to explain the context of the Epstein emails to the prime minister, who attended the Labour peer’s wedding at London’s Marylebone town hall in October 2023.

A source suggested that a number of people around the prime minister and the chancellor, Rachel Reeves, had always felt that Mandelson’s appointment was fraught with danger. It did not take much to convince them that there was no mileage in defending him further. “Keir’s instinct had always been to keep Peter at arm’s length,” said the source. “He was reluctant to go to Mandelson’s wedding but he was persuaded.”

That instinct to keep a distance has not been shared by everyone, including leading lights in Starmer’s cabinet. In the opposition years, as part of attempts to rid Labour of Jeremy Corbyn and his acolytes, Mandelson was a member of a Sunday supper party held at the Kennington home of Roger Liddle, a fellow Labour peer and longstanding friend. Regular guests included the health secretary, Wes Streeting, and his partner, Joe Dancey, himself a former Mandelson adviser.

Others who frequented the Georgian home for roast lamb and fine wine were Matt Doyle, formerly a spokesperson for Tony Blair and later to be Starmer’s director of communications, Matt Pound, who is today political secretary to chancellor Rachel Reeves, and Matthew Faulding who stood down as secretary of the parliamentary Labour party last November. Streeting is said to have joked that a blue plaque might be put up outside Liddle’s home given its role in the reinvention of Labour. “Maybe we will see Mandelson back by the side of prime minister Streeting?” a source suggested archly.

After four decades in frontline politics and a successful business career, Mandelson does not need to work. Company accounts for Global Counsel published earlier this month, show that it had repaid him £1.3m in loans in the last financial year as he cut his ties.

“Peter has nothing to do with Global Counsel now,” a source said. He returned from his grand residence on Washington’s Massachusetts Avenue to his rented four-bedroom home in Pewsey Vale, Wiltshire, where he has upset at least one neighbour by cutting down seven poplar trees said to be populated by nuthatches – small birds known for their loud, simple song.

But while the felling has given him and his husband a better view of the spectacular Downs, few believe the peace and quiet will be enough for him, even now, bruised and tainted by scandal, and in his eighth decade. “Peter is addicted to the political life,” said a friend. “He has to be seen.”