LA PAZ, Bolivia - Bolivian President Carlos Mesa bowed to protesters' demands Wednesday for a second time in two weeks, backtracking on fuel price increases he imposed recently and which triggered a massive opposition movement demanding his resignation.

In a move to defuse the crisis, Mesa announced a 6 percent reduction of gasoline and diesel prices, partially offsetting the 10 percent and 23 percent increases he had decreed nearly three weeks earlier.

"We are capable of listening and compromising," Mesa said in a speech to the nation.

His enemies hailed the announcement, but said they had not yet decided whether to end their protest movement.

"It's a good sign. It shows a different attitude of humility and flexibility," said Carlos Dabdoub, spokesman for the Santa Cruz civic group.

The price hikes set off a wave of protests across the country that spanned the ethnic and economic divide between the mostly poor, indigenous communities near the capital and the wealthy business elite in Santa Cruz, the largest city.

Analysts say widespread poverty and an economic crisis have made Bolivians lash out any time their wallets are hit.

Thousands of residents of El Alto march together at La Paz's San Francisco Square. (Aizar Raldes/AFP/Getty Images)

In El Alto, the combative city that overlooks La Paz, residents had also taken to the streets to drive out a French-owned water utility for failing to provide drinking water to thousands of poor homes.

Mesa, hindered by lack of support in Congress but firmly backed by Washington, has said he would rather step down than see blood spilled on the streets. His predecessor, Gonzalo Sanchez de Lozada, was ousted in a bloody uprising in October 2003 that claimed 70 lives.

In response to the protests in El Alto, Mesa canceled the water utility's contract.

But the protests continued. A group of peasants has been blocking a highway between the city and the country's main farming region for the past three days, cutting off supplies to the capital.

In Santa Cruz, some 200 labor and business activists are on a hunger strike and students on Wednesday began occupying public buildings in the city, forcing the government to tighten security.

Another group blocked access to the Santa Cruz airport, cutting off air travel from the city of 1.2 million people.

Mesa said he hoped his concession would calm the turmoil.