WASHINGTON  The effort to advance a major climate change bill through the Senate this summer collapsed Thursday even as President Obama signed into law another top Democratic priority  a bill to restore unemployment benefits for millions of Americans who have been out of work for six months or more.

Bowing to political reality, Senator Harry Reid, the Nevada Democrat and majority leader, said the Senate would not take up legislation intended to reduce carbon emissions blamed as a cause of climate change, but would instead pursue a more limited measure focused on responding to the oil spill in the Gulf of Mexico and tightening energy efficiency standards.

“We know where we are,” Mr. Reid told reporters after reviewing the state of energy legislation with Senate Democrats and administration officials. “We know that we don’t have the votes.”

The decision was a major disappointment to conservation groups and lawmakers who had invested months in trying to negotiate legislation. The House last year passed its own climate change bill, a proposal that has created a backlash for some politically vulnerable Democrats. The outcome was also viewed as a setback by some utility executives who had hoped that Congress would set predictable rules governing carbon pollution.