The British Airways parent’s new airline will operate from June between Barcelona and Los Angeles; San Francisco (Oakland); Buenos Aires; and Punta Cana.

Level will fly two new Airbus A330 aircraft branded with its own livery and fitted with 293 economy and 21 premium-economy seats.

Initially it will be operated by Iberia’s flight and cabin crew and will create up to 250 jobs in Barcelona, but IAG will also look to expand Level flights from other European cities.

Fares have already gone on sale and lead in from €99 one-way.

Willie Walsh, IAG chief executive, said: “Level is an exciting new IAG airline brand which will bring a stylish and modern approach to flying at prices that are even more affordable. It will benefit from having the strength of one of the world’s largest airline groups behind it.

“Level will become IAG’s fifth main airline brand alongside Aer Lingus, British Airways, Iberia and Vueling.

It will complement our existing airline portfolio and further diversify our current customer base.”

In response to the news, a Norwegian spokesperson said: “Norwegian firmly believes in healthy competition and if other airlines choose to launch their own low-cost long-haul services, this can only be good news for all passengers by increasing choice and lowering fares.”