A revitalised Diego Costa struck twice as Chelsea began their second spell under Guus Hiddink with a thrilling 2-2 draw at home to in-form Watford.

The Blues had to come from behind but will feel they should have claimed all three points as Oscar slipped and sent a potentially match-winning penalty ballooning into the stands with 10 minutes left.

Costa had given Chelsea a 32nd-minute lead, but Watford hit back as Troy Deeney tucked away a penalty and his ever-dangerous strike partner Odion Ighalo scored yet again after the break.

Another classy Costa finish levelled things up, but Oscar's blooper meant a pulsating Boxing Day encounter ended with the sides sharing the spoils.

The Blues looked eager to impress early on and Costa headed Pedro's cross just over as they monopolised possession in the first 15 minutes.

But Watford quickly found their feet and Ighalo squandered a great chance to give them the advantage, pulling his shot well wide after Jurado's effort had fallen perfectly for him.

However, Willian's corners were a regular source of problems for the Watford defence and Chelsea took the lead when the Brazilian's cross bounced into the six-yard box off the heads of Gary Cahill and John Terry, and Costa swivelled expertly before volleying the ball into the back of the net.

Suitably encouraged, Chelsea began to attack with gusto but Oscar shot over the bar after good work from Branislav Ivanovic and they then conceded an equaliser in bizarre fashion.

Ben Watson's right-wing corner appeared to pose little threat but Nemanja Matic completely misjudged its flight and ended up handling the ball right in front of the ref, giving Deeney (42) the chance to coolly roll his spot-kick into the net as Courtois dived off to his right.

And things got even better for Watford 11 minutes after the break when Ighalo (56) scored for a club-record fifth consecutive top-flight match in a row, albeit in fortuitous fashion.

Having been found by Jurado, the forward took his time before unleashing a low shot which hit Cahill's foot and flew into the net, with Courtois totally wrong-footed by the deflection.

Chelsea were undaunted and levelled the match when Willian, out on the right, found Costa (65) with an inch-perfect low pass and the forward finished adroitly once again, taking one touch to set himself up and then guiding the ball past Heurelho Gomes with his second.

Eden Hazard was fit enough for the Chelsea bench and, given 15 minutes to conjure up a winner for the hosts, it appeared to be mission accomplished when he was scythed down in the box by fellow substitute Valon Behrami.

However, Oscar failed to deliver from the spot in spectacular style, pausing as he began his run-up and then tripping over as he sent the ball high into the stands behind the goal.

The Blues continued to press forward nonetheless but Costa marred a good afternoon's work with a booking, which means he will be banned for Monday's big game against Manchester United.

The unlikely figure of John Obi Mikel almost sent Chelsea into that match on a high but his late shot was just wide of the target and Chelsea will go into the Old Trafford blockbuster just a couple of points clear of the drop zone.

Watford, meanwhile, emerged from another tough match with their reputation further enhanced and they sit seventh ahead of Tottenham's visit to Vicarage Road on Monday.

Alan McInally's Soccer Saturday verdict:

"Willian is far and away the best in Blue at the moment, he was fantastic. Every corner caused plenty of problems for Chelsea, the delivery was fantastic

"I have to take my hat off to Watford. They were never genuinely out of the game, even though they conceded first. The two boys up front were fantastic.

"Costa took a couple of bangs today, and actually half behaved himself this afternoon. He was better, his movement was okay, and the finishing was excellent. Oscar does slip for his penalty and is very unlucky."

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Player ratings:

Chelsea: Courtois (6), Ivanovic (7), Cahill (6), Terry (6), Azpilicueta (6), Fabregas (6), Matic (5), Willian (8), Oscar (5), Pedro (6), Costa (8)

Subs used: Mikel (6), Hazard (7)

Watford: Gomes (7), Nyom (6), Cathcart (6), Britos (6), Holebas (7), Abdi (6), Capoue (6), Watson (7), Jurado (7), Ighalo (8), Deeney (7)

Subs used: Behrami (4), Anya (6), Guedioura (6)

Man of the match: Diego Costa

Teams

Chelsea Courtois, Ivanovic, Cahill, Terry (c), Azpilicueta, Fabregas (Mikel 45), Matic, Willian, Oscar, Pedro (Hazard 75), Costa
Subs Not Used Begovic, Rahman, Zouma, Ramires, Remy
Booked Costa
Goals Costa 32, 65

Watford Gomes, Ntom, Cathcart, Britos, Holebas, Abdi (Behrami 69), Watson, Capoue, Jurado (Anya 73), Ighalo, Deeney (Guedioura 90)
Subs Not Used Prodi, Berguis, Diamanti, Arlauskis
Booked Britos, Cathcart, Holebas, Behrami
Goals Deeney 42 (pen), Ighalo 57

Attendance 41,620

Referee Andre Marriner