NEW YORK - Oil prices fell sharply Monday, pulling back from...

NEW YORK - Oil prices fell sharply Monday, pulling back from record levels as investors feared that the financial crisis that forced the sale of Bear Stearns Cos. is a sign of deep economic troubles.

Crude’s plunge came even as diesel prices rose to a new record above $4 a gallon, and gas prices remained high. Diesel, used to transport the vast majority of the nation’s goods, rose 1.3 cents to a national average of $4.002 a gallon Monday, according to AAA and the Oil Price Information Service. The national average price of a gallon of gas, meanwhile, dipped slightly to $3.283 a gallon, but remains 73 cents higher than a year ago.

Oil’s steep decline — falling $4.17 to $106.04 a barrel on the New York Mercantile Exchange — came hours after futures rose to a new trading high of $111.80 on the Federal Reserve’s surprise Sunday move to lower a key interest rate by a quarter point. In the past several months, Fed rate cuts have fueled rallies in oil prices.