With an agreement on Open Skies between Europe and the United States looking likely to be in effect before the year is out, a spokesman for Virgin Atlantic has told the Sunday Times that the British-based airline could soon be flying direct to the US from the Continent.

Open Skies, which would scrap the current complex restrictions on flights across the Atlantic, has been fiercely debated by both sides for many years, and is anticipated to finally reach a conclusion when Europe votes on the current deal on the table. However, it is also reported that Prime Minister, Tony Blair, will attempt to broker a better deal for Britain when he meets George W. Bush on Tuesday. Blair is seeking liberalisation of U.S. aviation ownership rights in exchange for access to Heathrow, a jewel in the crown of the Open Skies agreement.

Currently only two airlines from the U.S., American Airlines and United, and two from the UK, British Airways and Virgin Atlantic, are allowed to fly direct from Heathrow to the United States. Both BA and Virgin have both argued strongly against the opening up of Heathrow, and while BA continues to lobby the government, Virgin is now making plans to exploit what it sees as inevitable. The cost of expansion has been quoted as £200m and create 500 jobs.

Sources in Washington believe it would be unlikely that Blair's appeal to President Bush will be successful, other than to delay the introduction of Open Skies for a few months. However if the Prime Minister were able to find some negotiation of U.S. ownership rights on domestic carriers, it would be good news for Virgin America, whose application to fly was refused at the beginning of the year by the U.S. Department of Transport on the grounds that foreign investment would effect undue control over the airline, despite, on paper, complying with the government restrictions.

European transport ministers will vote on Thursday on the Open Skies deal. Should they decide to move forward on a majority vote rather than unanimous, then the UK could find itself forced into opening up Heathrow with no further concessions.