Derry's most senior police officer has said lives could have been lost in this morning's car bomb attack in the city.

There was major disruption to traffic following the explosion outside a police station in the Cooke Street area.

Chief Superintendent Stephen Martin said the bomb contained 200lb of home made explosives.

Nobody was injured but a number of buildings in the area were damaged, including a nursing home and apartments.

Early indications are that dissident republicans were responsible for the attack.

Two men approached a taxi driver in the Cooke Street area of the city at around 3am. One of the men was armed.

They placed a device in the car and ordered the driver to take it to the PSNI station.

An explosion took place soon after the vehicle was parked outside the station. The PSNI says it was aware of events.

Derry Mayor Colm Eastwood said the people of the city would be outraged by the attack.

The SDLP's Mark Durkan also condemned those behind the attack. 'This was a cowardly, dangerous and vulgar act.

'It is extremely fortunate that no injury has been caused or life lost as a result of this attack.

'Those responsible for this incident have achieved nothing and this campaign of violence will achieve nothing.'

DUP MP Gregory Campbell has called for resolute action to be taken against those responsible.

He said: 'It is essential that not only words of condemnation follow these attacks but action flows from them as well.

'Describing the perpetrators as 'evil' or 'traitors' is accurate as far as it goes but what is required to prevent re-occurrence is information, evidence, prosecution, conviction in a court followed by lengthy prison sentences.

Sinn Féin Foyle MLA said: 'I would call on those who support these groups to come forward and explain to the people of Derry how these bombs will in any way advance republican objectives.'