I just found this out and it seems pretty important! http://www.slate.com/blogs/future_t..._disable_java_on_your_browser_right_now_.html I just want to add to this. Read the whole article and don't panic. Towards the end it gives you instructions to disable your add ons for Java.
Yes it is! I'm sure Oracle will be on top of this pretty soon! They usually do quarterly updates, but in this instance I think they'll have a fix before October!
I just checked, my version is still Java 6, so I should be safe according to the article. Flaw is in version Java 7