French President Emmanuel Macron scrapped a fuel tax rise amid fears of new violence after weeks of nationwide protests and the worst rioting in Paris in decades.
Three weeks of demonstrations left four people dead and were a massive challenge to Macron.
"The government is ready for dialogue and is showing it because this tax increase has been dropped from the 2019 budget bill," Prime Minister Edouard Philippe told lawmakers on Wednesday.
French protesters welcome Macron's decision to scrap the fuel tax rise planned for next year, but said it may not be enough to contain public anger.
Read more: 'Gilets jaunes': who are they and what do they want? - Euronews - VIDEO
Jacline Mouraud, a protest group's self-proclaimed spokespeople, told The Associated Press, "I think it comes much too late."
She said each of the disparate protesting groups will decide what to do next, but many will probably keep demonstrating. She said Macron's move "is on the right path but in my opinion it will not fundamentally change the movement".