US Congress struggles to respond to public anger over high gas prices

Congress considered billions of dollars in new taxes on oil companies Thursday, looking for ways to punish the cash-rich industry and soothe growing anger over high gasoline prices.

Photo: US Congress struggles to respond to public anger over high gas prices

Senate Republicans also proposed a $100 fuel-cost rebate for millions of taxpayers, and Democrats talked of suspending the 18.4-cent federal gasoline tax for two months to ease Americans' pain at the pump.

But even as lawmakers jockeyed for political advantage on the volatile issue, there was widespread agreement among economists and energy experts that the government has few if any weapons to quickly drive down gasoline prices that have rushed past $3 ( Ђ 0.63 per liter) a gallon across much of the country.

"Unfortunately there's nothing, really, that can be done that's going to affect energy prices or gasoline prices in the very short run," Federal Reserve Chairman Ben Bernanke told a congressional hearing, reportas AP.

The prospect that the Fed may pause enabled the market to bounce back from initial losses, triggered by China's decision to lift its benchmark rate unexpectedly.

FirstEnergy Corp. and Bank of America Corp. led gains in utilities and financial companies, among the most sensitive to borrowing costs, after Bernanke testified to Congress that the Fed may "decide to take no action at one or more meetings."

"Few people thought that he would be that explicit," said Frederic Dickson, chief market strategist at D.A. Davidson & Co. in Great Falls, Montana, which manages $16 billion. "We're getting closer to the end of the Fed interest-rate hikes."

The Standard & Poor's 500 Index added 4.31, or 0.3 percent, to 1309.72, just 0.2 percent from a five-year high. The Dow Jones Industrial Average advanced 28.02, or 0.3 percent, to 11,382.51, a six-year high, informs Bloomberg.

O.Ch.