Senate Republicans thought they would be spending the days leading into the August recess backing Democrats into a corner over high gas prices, but Tuesday’s news of Sen. Ted Stevens’ (R-Alaska) legal woes relegated them to playing defense and effectively quashed the Conference’s optimistic mood of the past few weeks.

GOP Senators believed they were gaining momentum with their message on energy, one of the few bright spots in an election year that portends bruising losses for the minority party. But then the bombshell hit — that Stevens had been indicted on seven counts for not reporting more than $250,000 he received in gifts from an oil services company. That news trumped their improving fortunes as it swept through the Senate, leaving lawmakers speechless and saddened.

The Republican Senate leadership’s regular Tuesday press conference was transformed from an opportunity for Minority Leader Mitch McConnell (Ky.), Minority Whip Jon Kyl (Ariz.) and Senate Republican Conference Chairman Lamar Alexander (Tenn.) to tout their efforts to pass broad energy legislation into a three-sentence statement from McConnell. All told, McConnell spent less than 30 seconds at the microphones.

“Let me just say that the Republican Conference, like you, just learned of this news. We’ll no doubt have more to say about it later. But for the moment, I’m going to be joining [Majority Leader Harry Reid (D-Nev.)] and see if we can move forward on the energy package that we may be voting on later today,” McConnell said before walking off without taking questions.

Alexander canceled an afternoon press conference with House Republican Conference Chairman Adam Putnam (Fla.) that was intended to accuse Democratic leaders of shielding their presumptive presidential nominee, Sen. Barack Obama (Ill.), from casting politically difficult votes on drilling for more oil.

Asked whether the Republicans had been knocked off their game, Alexander morosely stated, “We have our jobs to do, and we’ll keep doing it.”

The energy debate itself was losing steam. Reid might have dashed prospects of a bipartisan deal on the oil markets speculation bill by saying Tuesday that if Republicans want to offer more than four amendments, they would have to end their filibuster of a separate tax extenders bill that includes credits for renewable energy. It’s a proposal Republicans are likely to reject, but both sides insisted negotiations were continuing.

News of Stevens’ legal troubles hit Republicans during their weekly Tuesday luncheon where they had planned to discuss whether to accept Reid’s offer on amendments. They left lunch only to be greeted by a barrage of questions about Stevens’ future, not energy policy.

“I’ve known Ted Stevens for 28 years and I’ve always found him to be impeccably honest,” Sen. Arlen Specter (R-Pa.) said.

“I think he has shown tremendous leadership in the Senate. … We all have unexpected moments in our careers,” Sen. John Warner (R-Va.) offered. “We have to work through them. I wish him the best.”

The well wishes came from all corners of the Senate, from moderates and partisans, Democrats and Republicans. Stevens has become an iconic figure in a body that relishes in its seniority. Having served in the Senate for 40 years, longer than any GOP Senator, he is a colorful, sometimes gruff character who fiercely protects his state’s interests. Famed for his volcanic temper, Stevens is also a dealmaker who reaches across the aisle. A legendary appropriator and former head of that panel, Stevens has funneled hundreds of millions to his state.

Majority Whip Dick Durbin (Ill.), the No. 2 Democrat, said there was a “somber reaction” to the Justice Department’s findings when it was discussed in the Democrats’ luncheon Tuesday. Durbin said that while Senators “fight like cats and dogs over the issues,” the Senate is akin to a family, and he could not “wish ill to Sen. Stevens or his family.”

“My heart goes out to his family,” Sen. Kent Conrad (D-N.D.) said.

When asked if he believes Stevens is innocent, longtime friend Sen. Daniel Inouye (D-Hawaii) said, “I do.”

Stevens, 84, has been under a cloud of suspicion for months related to his dealings with an Alaska oil developer who performed a renovation on his Girdwood, Alaska, home. Tuesday’s indictment brought those rumors full circle when Stevens was charged with failing to report thousands of dollars in gifts, much of it related to his home renovation.

The Justice Department allegations against Stevens are the latest in a steady stream of corruption charges dogging the GOP. Many believe the party’s losses in the 2006 elections were partly fueled by public concerns over Republican ethics, and in the past two years, Senators have had to work through new scandals, including those involving the sexual behavior of two of their own, Sens. David Vitter (La.) and Larry Craig (Idaho).

Ethics Chairman Barbara Boxer (D-Calif) and Vice Chairman John Cornyn (R-Texas) issued a statement saying that the panel does not comment on matters that it might consider.

“Absent special circumstances, it has been the long-standing policy of the Committee to defer investigation into matters where there is an active and ongoing criminal investigation and proceeding so as not to interfere in that process,” the statement said.

In a statement Tuesday afternoon, Stevens declared his innocence.

He has never shied away from a fight, including doing battle with his fellow Republicans, like presumptive GOP presidential nominee, Sen. John McCain (Ariz.), over earmarks for Alaska. He’s also staring down a political battle at home, where he is facing a challenge from Anchorage Mayor Mark Begich.

The charges immediately changed Stevens’ status in the Senate. Under Republican Conference rules, he was forced to relinquish his ranking member slots on the Commerce, Science and Transportation Committee and the Appropriations Subcommittee on Defense. Stevens can retain his positions as a rank-and-file member of those committees.

On the Commerce Committee, McCain is the second-ranking Republican, but since he is the top Republican on the Armed Services Committee, he is likely cede the job to the third in line, Sen. Kay Bailey Hutchison (Texas.).

Sen. Lindsey Graham (R-S.C.) said he wouldn’t try to predict what’s next for Stevens, but he shared the view of most of his colleagues that the Republican Senator from Alaska is entitled to a presumption of innocence. Graham said, “It seemed to work for 200 years. We ought to keep it.”

John Stanton contributed to this report.