Chelsea's pursuit of Michael Olise looks to have hit a brick wall after the midfielder signed a new four-year deal with Crystal Palace.

The Blues appeared to be closing in on the capture of the midfielder, 21, after reportedly activating a £35million release clause earlier this week.

However, Palace chairman Steve Parish has all-but quashed those hopes by announcing Olise's new deal at Selhurst Park via his Instagram account.

Parish's post said: "I'm absolutely delighted to announce @m.olise has decided to commit his future to Crystal Palace and this afternoon signed a new four-year deal with the club."

Speaking ahead of his side's clash with Arsenal on Monday, Eagles boss Roy Hodgson said: "It's the best possible news we could have.

"It's always concerning when a club of Chelsea's stature take interest in a player and people will suggest a move might be the best bet.

"I had always hoped that wouldn't be the case and that Michael would realise his future here is very bright and we can help him move very quickly on to another level. 

"I am delighted for the club. I had a long chat to him and I made it clear how much I enjoyed working with him and how much potential he has as a player.

"I suggested, of course, that being at Crystal Palace and playing here would be the best option. But I also made it clear I wouldn't put him under unnecessary pressure."

French youth international Olise's reputation skyrocketed in 2022-23 as he racked up 11 Premier League assists and picked up Palace's Player of the Season award.

He was widely expected to become the latest acquisition of Todd Boehly's summer shopping spree at Chelsea, alongside Southampton starlet Romeo Lavia.

But Palace, who kicked off their new campaign with a 1-0 win at Sheffield United last Saturday, have convinced their prized asset to stay put. 

Former Reading prospect Olise has made 71 appearances for the Eagles in all competitions, scoring six times.