Brazil, the only country with a major fuel alcohol industry, is cutting back subsidies to the controversial sector, which has been denounced by its critics as a drain on the nation's resources.

In a major revision of the program, the government Thursday reduced the price differential between gas and alcohol fuels. The price of alcohol at the pumps is now officially fixed at 69 percent of that of gasoline. Previously it had been 65 percent.

The heavily subsidized sugar alcohol industry has many critics and they hailed the government's decision as evidence that the authorities were retreating from an expensive failure.