Ryanair has reached an out-of-court settlement with BAA over charges at Stansted which last year prompted the Irish low-cost airline to describe the airport operator as "a bunch of overcharging rapists".
BAA has agreed to cut its levy on fuel at the Essex airport from 68p to 41p per litre. In return, Ryanair is to pay back the £1m of landing fees it had refused to hand over, raising a threat of high court action.
The Irish airline said: "This agreement will last until the next regulatory review starts in April 2008."
The confrontation had prompted suggestions that Ryanair could scale back its services at Stansted, where it handles 12.5 million passengers annually.
The Irish airline objected to paying above the odds for fuel. BAA justified the its surcharges on the grounds that it had invested in hi-tech facilities to deliver petrol to aircraft. Ryanair claimed this cost had already been recovered by BAA but that the fuel levy was still being imposed.
Ryanair's outspoken chief executive, Michael O'Leary, has long been a critic of BAA's management of Stansted, accusing it of building "little Noddy trains" and "Taj Mahal terminals" which were not suitable for budget carriers.
