British Gas has announced it will reduce its gas prices by 10%, from February 19.

The energy provider's reductions will apply to all customers on British gas standard tariff. This will benefit more than 7.5 million homes - 75% of it's client base.

British Gas - part of the Centrica group, trading as Scottish Gas in Scotland - said it was the first major UK energy supplier to announce such a cut since 2007.

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It estimates the cuts will save customers £79 on the average household gas bill.

In July last year, the company raised its prices by a record 35%. Meanwhile other firms lifted prices by more than a fifth.

British gas managing director Phil Bentley said: "We understand energy bills are a significant cost and we are committed to providing the best possible prices for customers.

"This price cut will go some way to helping customers manage their budgets, and we will continue to do what we can, when we can."

The cost of wholesale gas, linked to the price of oil, has fallen significantly from the peak it reached last summer.

In July 2007 crude oil reached almost $150 a barrel, but has since slumped as low as $38.

(JM/BMcC)