This is the song that Luke sings to Lorelai, in order to tease her about being asked out by Kirk. “Love Is in the Air” is a 1977 disco song by Australian singer John Paul Young, written by George Young and Harry Vanda, and released as the lead single from John Paul Young’s album Love Is in the Air. It went to #3 in Australia, and was a world-wide hit, going to #5 in the UK and #7 in the US, but most popular in Norway, Sweden and South Africa, where it went to #2. It went to #1 on the Billboard Adult Contemporary chart.
The song was featured in the 1992 Baz Luhrmann film Strictly Ballroom, remixed with a ’90s dance beat. Re-released as a single from the Strictly Ballroom soundtrack, it went to #3 in Australia, and was most popular in New Zealand at #2.
It is a bit surprising that Luke knows this song, and most likely watched Strictly Ballroom, which doesn’t seem like his sort of film. Maybe he went to it with a girlfriend?