After several of the world’s central banks cut interest rates Thursday morning, oil and the other major commodities fell sharply as the dollar moved upward and traders continued to worry about the worldwide economy.

Crude Oil

At the 2:30 p.m. preliminary close in New York, crude oil futures fell by $4.58 to $60.72 a barrel in New York -- extending a sharp two-day losing streak for the valuable commodity. It brought oil to its lowest settlement level since March 2007.

This comes after the Bank of England and the European Central Bank drastically cut their respective interest rates early Thursday. Both the U.K. and euro-zone financial ministers warned that economic growth in the region was drastically slow in the upcoming months.

“The level of uncertainty stemming from financial market developments remains extraordinarily high and exceptional challenges lie ahead,” said ECB President Jean-Claude Trichet in a statement when the bank announced a half-point interest rate cut.

The Bank of England announced a 1.5 percentage-point cut in interest rates this morning.

Here in the U.S., Friday’s jobs report is expected to be especially grim, according to Wall Street economists. The consensus estimate for the October report is indicating that the nation lost 200,000 jobs last month, bringing the U.S.’s unemployment rate up to 6.3%.

Oil demand has fallen off a cliff in recent weeks, sending commodity futures down with it. Major world agencies like the International Energy Agency have cut global crude the demand as all of the major Western economies have slowed down and possibly are now in recession.

The IEA cut on Thursday its world oil demand estimate for 2030 by 10 million barrels, as a result of this economic slowdown.

Also weighing on commodities is a intraday surge in the value of the U.S. Dollar. The U.S. Dollar Index was up 1.2% in Thursday trading. Commodities such as oil, natural gas and gold are often inversely related to the moves in the dollar -- if the dollar gains, commodities generally fall. 

Wholesale heating oil, which is closely watched during the colder parts of the year, fell 10.67 cents to $1.94.80 a barrel.

Natural Gas

Natural Gas futures also fell sharply despite a natural gas inventory report showed a less-than expected build in natural gas supplies.

Natural gas fell by 27.4 cents, or 3.78%, to $6.973 per million British Thermal Units as of 1 p.m. in New York.

According to the U.S. Energy Department, the nation’s natural-gas inventories rose by 12 billion cubic feet as of the week ending Oct. 31.  

Analysts had expected a build of 20 billion to 25 billion cubic feet, according to a survey by Platts.

Other Commodities

Gold fell by $5,50, or 0.74%, to $736.90 an ounce.

The agricultural commodities such as wheat and corn were down more than 2.5% each in midday trading.