The price of oil continues to rise like an uncapped gusher, soaring 3.3 percent to more than $133 a barrel yesterday—just in time for Memorial Day and the start of what promises to be the worst summer for road trips since the horse and buggy.

The Wall Street Journal, Financial Times, and Bloomberg blame Wednesday’s spike on a much-worse-than-expected report showing U.S. oil inventories dropped more than 6 percent from a year ago when analysts had projected a small increase.

The politicians hauled Big Oil before Congress for some well-timed questioning and posturing, as The New York Times reports on its Business Day front:

Such showdowns between lawmakers and oil titans have become a familiar routine on Capitol Hill. But with gas prices nearing $4 a gallon, and lawmakers headed home for a weeklong Memorial Day recess where they expect to get an earful from angry constituents, there is added urgency for Congress to appear active.

The NYT and the Journal on A3 write that Democrats are planning legislation that would tax “windfall profits,” and the Times also notes they want a measure cracking down on speculation. Dana Milbank of The Washington Post, in the midst of comparing the show on Capitol Hill to “The Price Is Right”, reports that the White House fanned out an e-mail during the proceedings threatening to veto renewable-energy incentives. Nevertheless, the House passed the $57 billion measure by a wide margin.

The WSJ and the FT write that the market for oil contracts deliverable in 2016 has risen even faster in the last few weeks. With oil prices up 11 percent since May 5, long-term oil prices are up 27 percent to $142 a barrel, something the FT attributes to an influential Goldman Sachs report that predicted prices rising to $200 a barrel. The Journal says a worldwide shortage of diesel is pushing prices, too.

The outlook isn’t any better.

The Journal reports on A1 that the International Energy Association, “the world’s premier energy monitor,” is slashing its estimates of global oil supply. It has said for years that supply would rise to 116 million barrels a day by 2030, but now thinks it might “struggle to surpass 100 million.”

The NYT on C1 writes that oil prices are reviving coal mining in several countries.

As if airline service wasn’t lousy enough

The impact of the sky-high prices continues to be felt throughout the economy. American Airlines yesterday said it would slash service and start charging extra to check a bag—$30 roundtrip on many domestic flights. Bring two bags and it’ll cost $80 total. The Journal, FT, and NYT all put the news on A1.

American also said it would cut the number of total seats it flies by 12 percent to eliminate unprofitable routes and to put pressure on prices. Flights are already more packed than they’ve ever been, so air travel will only get more fun. Forget about flying standby. Other airlines are looking at following American’s lead on charging for checked bags, the papers say, but the Times notes that it could backfire on American if they don’t, and the FT reports that Delta already says it won’t.

The Journal on D1 gets the P.O.’d Traveler Quote of the Day:

“Maybe we should just FedEx our bags,” she says.

However, a fifty-pound bag transported by FedEx Corp. or United Parcel Service Inc., using next-day delivery, costs more than $200.

And travelers better get used to the fact that airfare is about to go way up, like their gas bills have been doing for a few years now. The airlines have already gone through wrenching years of cost slashing and they’ve cut into muscle, as seen by the maintenance scandal, and they can’t continue to lose $3 million a day, as American has been doing.

Litany of bad economic news sours market

The oil markets helped send stocks down big again, with the Dow Jones Industrial Average off more than 220 points on the day to 12,601.19. Stocks were also weighed down by pessimistic news out of the Federal Reserve, which sharply lowered its growth estimates for this year on concerns over inflation and the credit crisis, the papers say.

The Fed now projects the economy to grow as little as 0.3 percent this year, a full point lower than it’s previous estimate, and raised its inflation estimate by a point. It says unemployment could reach as high as 5.7 percent, up from the current 5 percent, the WSJ reports on A3.

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum.