help! what should I do??

Is it usual/natural for a potential employer to call current employer for reference prior to even calling the applicant for an interview? I was notified by my supervisor and he was not happy about it... Not only it seems inappropriate, but they dont seem to care about the applicant's current job and situation. I mean, why would any considerate employers do this? After this dreadful experience, I'm now almost afraid to apply for new jobs...

What can or should I do going forward? I really dont want anyone to call my current employer prior to accepting an offer.

You are now in a very difficult situation. I would have a conversation with the HR Director at your potential employer to find out who made the call and the reason for the call so soon in the process. Did you fill out an application giving them the authority to call your current employer? I would express my displeasure with them about this.

I never heard of this happening. In almost all cases, the potential employer or recruiter will specifically ask when/how they should contact your current employer.

No. I applied through careerbuilder. It was a simple resume submission, nothing more.

Is calling their hr really a good idea? Wouldnt that eliminate any chance for an interview?

Well, it certainly won't help, but I'd be awfully skeptical about an offer from such an inconsiderate employer, anyway.

As for your existing position, I'd just tell the supervisor that you have a duty to yourself, family, etc., to continuously look for opportunities to advance yourself professionally, and that while you hope those come up with your current employer, you'd be foolish not to explore other options. I'd note that this was simply sending in a resume, and that if any search became something serious you'd be sure to keep your current employer and supervisor in the loop, and give plenty of time for a transition. In the meantime, if they'd like to have a conversation with you about your worth to the organization and the opportunities they are grooming you for, they're welcome to do so.