Sebastian Vettel, one of the hottest properties in Formula One, today extended his contract with the Red Bull team until the end of 2011 with the option of a further year.

The German is third in the world championship after winning the Chinese and British Grands Prix.

He confirmed his speed in the opening practice session for the European Grand Prix in Valencia by overcoming a spin to set the fifth best time, just over half a second behind the pace-setting Brawn GP of Rubens Barrichello.

The Red Bull agreement, thought to be worth up to £10million, keeps Vettel from the clutches of Ferrari and comes in the wake of Australian team-mate Mark Webber also agreeing a new contract.

With Vettel off the market, rumours that Fernando Alonso would swap his seat at Renault for one at Ferrari in 2010 were given new credence this morning when McLaren team principle Martin Whitmarsh implied it was already a done deal.

It is understood that Alonso, who briefly drove for McLaren after winning back-to-back titles with Renault, will replace Kimi Raikkonen to drive alongside Brazil's Felipe Massa.

Raikkonen, the 2007 world champion, has shown increasing signs of becoming disenchanted with Formula One and it is believed the Finn will contest the World Rally Championship if Ferrari offer enough to buy out the remaining year of his contract.

Whitmarsh has clearly been keeping a close eye on driver movements, and he maintained the pressure on Heikki Kovalainen by again insisting the Finn has got to perform better in races if he is remain as Lewis Hamilton's team-mate next season.

Germany's Nico Rosberg, son of former world champion Keke Rosberg, has made no secret of his desire to join McLaren from Williams, and his nationality would be attractive to McLaren's engine suppliers Mercedes-Benz.

As he watched Kovalainen finish second fastest this morning, just ahead of Hamilton, Whitmarsh claimed: “We're not talking to any other drivers at the moment.

“We want to see Heikki be successful in this team, but at the same time we're obliged to have as competitive drivers as we can.”

Today's announcement by Red Bull regarding Vettel will focus the minds of team chiefs up and down the pit lane, especially as highly-regarded Polish driver Robert Kubica is open to offers following the decision of BMW Sauber to quit Formula One at the end of the season.

Renault will be favourite to sign Kubica as team leader if, as expected, Alonso moves on.

Barrichello's best lap around the Valencia street circuit of 1min 42.460secs was 0.176secs faster than Kovalainen. Jenson Button, leading the title chase in the other Brawn GP, was fourth.

Italian veteran Luca Badoer, substituting for the injured Massa after plans for Michael Schumacher to make a comeback fell through, was last with a time over three seconds off the pace.