The Molineux men are three points adrift of safety ahead of next Saturday's final game of the season at Brighton and seemingly need a miracle to avoid a second successive relegation.
"I am devastated," Saunders said as angry Wolves supporters vented their fury for some time after the match.
"We should never be in the position that we are in. We have got ourselves in a terrible position, forget this game, we should never be in this position.
"We are not dead yet, obviously it is stacked up against us but stranger things have happened. Strange things happen every year and we have to make sure that they happen to us.
"It was in our own hands before this game but we let in two terrible goals and I am really frustrated about that."