Oil surged to fresh record highs due to worries about supply interruptions on Friday, driving down European shares and bond yields, while the dollar eased ahead of key U.S. job data. Brent crude hit $41.40 on Friday, the highest point since the contract started trading in 1988, on supply concerns due to a U.S. refinery fire and questions about future exports from Russian oil major YUKOS. A fire forced the closure on Thursday of a gasoline-producing unit at BP's 470,000 barrels per day Texas refinery, the third-biggest in the United States. Fears that strong oil prices can cut economic growth are weighing on equities but supporting bond prices because they are seen as reducing the pace of any future interest rate increases. "If oil prices rise above $50, that would really hurt consumers and the market is worried about that," a debt trader in London said. Shares of firms which are major oil users such as airliners British Airways, Air France and Iberia fell by up to three percent. Besides oil, the market is focussing on U.S. non-farm payrolls data for July for further clues about the direction of U.S. monetary policy. Economists polled expect payrolls to rise by 228,000 in July. The data are due for release at 1230 GMT. --More 1350 Local Time 1050 GMT
