Plaid Cymru Parliamentary Leader Elfyn Llwyd MP said:
"I am very pleased that the Chancellor has finally seen sense and scrapped this damaging proposal which would have put even more strain on businesses and ordinary people's pockets during a time of financial crisis.
"This was the elephant in the room as far as the Budget was concerned, with the Chancellor repeatedly ignoring the fact that soaring fuel prices were the main drivers of rising inflation.
"Rising fuel costs impact the daily lives of the majority of ordinary people, particularly in rural areas such as my Dwyfor Meirionnydd constituency where efficient transport is essential.
"This latest in a string of government u-turns will offer people some relief as they struggle to make ends meet - at least until the end of the year as the Chancellor has noted.
"However, it is a shame that it took until this morning for the Labour Party to declare its support for this hugely important campaign. Had they acted sooner, a full cross-party campaign may have pressured the Chancellor into changing his mind months ago.
"Sadly, Labour's lethargy and the Coalition's complacency has yet again left many people suffering unnecessarily.
"Plaid Cymru alongside the SNP have been calling for a genuine fuel duty stabiliser for nearly a decade and that is yet to be achieved, but at least this further damage has been avoided.
"We can only hope that in future, campaigns which put people before politics will be met with greater enthusiasm from all parties."