After a one-day reprieve, oil prices shot higher again Thursday, setting another record. The jump spooked investors and drove the Dow Jones industrial average below 10,000 on fears that higher energy costs could further dampen consumer spending and undermine an already fragile economic recovery.

Crude oil contracts for September delivery closed at $44.41 per barrel in New York trading on renewed concern about a loss of supply from Russia.

Market analysts and traders said the highter oil prices directly led to a stock market sell-off in which the Dow fell 163.48 points, or 1.6 percent, to close at 9963.03, with 29 of 30 stocks in the average closing lower. It was the worst one-day point and percentage decline for the Dow since March 11, when it dropped 168.51, or 1.64 percent.

Other major market indicators sank as well. The technology-heavy Nasdaq composite index slipped 33.43 points, or 1.8 percent, to close at 1821.63. The broad Standard & Poor's 500-stock index closed at 1080.70, down 17.93, or 1.6 percent. It was the lowest close for the S&P 500 this year as 468 of 500 stocks in the index declined.

All three major stock market indicators have lost ground this year. The Nasdaq has fared worst, down 9 percent. The Dow is off 4.7 percent, while the S&P 500 is down 2.8 percent.

Despite the recent increase, energy analysts and economists note that when adjusted for inflation, oil prices are still far from where they were during the energy crisis of the late 1970s and early 1980s and that the United States has a solid supply of gasoline.

But experts also said oil prices are high enough to dent consumer spending, threatening a key pillar of the economic recovery at a time when the health of business spending and hiring remains uncertain.

If businesses fail to pick up spending where consumers leave off, or fail to sufficiently increase worker paychecks, the recovery could falter. That fear is reflected in the stock market.

"Oil prices are clearly part of the market's weakness," said Henry Cavanna of Cavanna Capital Management. "The question is whether they will undermine economic expansion."

A large part of the answer could come Friday, when the Labor Department issues its July jobs report. The economy has added jobs every month since last August, but the size of the monthly increase peaked in March and dipped in each of the three months since.

Economists say employment must rise by around 200,000 jobs per month to keep the recovery on track. Only 112,000 new jobs were created in June.

"[Oil prices] are certainly going to dampen things a bit, there is no getting around that," said Cynthia Latta, economist at Global Insight in Lexington, Mass. "But alone they aren't enough to derail the recovery. . . . If hiring picks up and we get 200,000 new jobs a month we will be okay. If we don't . . . that could slow things down."

Thursday's jump in oil prices came after the Russian government changed course and blocked Yukos Oil Co. from using frozen bank accounts to fund operations. Yukos is fighting bankruptcy amid charges by the Russian government that it owes $3.4 billion in back taxes. Mikhail Khodorkovsky, the largest shareholder in Yukos's parent company, is on trial in Moscow on charges of fraud and tax evasion.

Oil prices eased on Wednesday when it appeared that Russia would allow Yukos to use frozen money to fund its operations. But the Russian Justice Ministry said Thursday that the company did not have permission to do that.

Questions over continued oil flow from Russia have become more market-rattling as worldwide demand for oil soars, driven by expanding economies such as those of China and India, and because most oil producing nations are pumping at or near capacity. The threat of political turmoil in Nigeria and Venezuela, two major oil-producing nations, as well as continuing unrest and terror attacks in Iraq and throughout the Middle East add a further "risk premium" to prices, experts say.

"What's going on here is that inventories are still low enough on a global basis and [the Organization of Petroleum Exporting Countries'] spare capacity is tight enough that the markets are walking a tightrope," said Deutsche Bank analyst Adam Sieminski. "What everyone is afraid of is that just one more accident or sabotage or natural disaster and you are looking at $50 a barrel, if not something north of that."

Thursday's stock market decline was led by blue-chip companies such as Wal-Mart Stores. The retailing giant said July sales rose just 3.2 percent, the second-slowest increase in 13 months. The company said higher gas costs cut into consumer spending. Shares in the firm dropped $1.15, or 2.2 percent, to close at $52.05.

Tom McClellan, publisher of the McClellan Market Report, said stocks have entered a period of direct, negative correlation with oil prices. "So today's run-up in crude drove stocks down," he said.

Stephen Stanley, economist at RBS Greenwich Capital Markets, suggested that the correlation might not change until oil, along with fear of both domestic and foreign terror attacks, is not the main subject of conversation among investors and traders.

"Right now the tone of chatter in the room here is more like the post 9/11 environment. . . . People are more nervous and they are definitely talking about [oil] every day," rather than about the strength of the economy, as they were earlier this year.

Other Indicators

* The New York Stock Exchange composite index fell 89.96, to 6295.10; the American Stock Exchange index fell 13.22, to 1224.47; and the Russell 2000 index of smaller-company stocks fell 10.31, to 532.36.

* Declining issues outnumbered advancing ones by 8 to 3 on the NYSE, where trading volume rose to 1.39 billion shares, from 1.36 billion on Wednesday. On the Nasdaq Stock Market, decliners outnumbered advancers by 2 to 0 and volume totaled 1.55 billion, down from 1.65 billion.

* The price of the Treasury's 10-year note rose $1.88 per $1,000 invested, and its yield fell to 4.40 percent, from 4.42 percent on Wednesday.

* The dollar rose against the Japanese yen and fell against the euro. In late New York trading, a dollar bought 111.71 yen, up from 111.13 late Wednesday, and a euro bought $1.2057, up from $1.2041.

* Light, sweet crude oil for September delivery settled at $44.41, up $1.58, on the New York Mercantile Exchange.

* Gold for current delivery rose to $392.30 a troy ounce, from $392.20 on Wednesday, on the New York Mercantile Exchange's Commodity Exchange.

Traders work in the oil trading pit of the New York Mercantile Exchange.