Tropical Storm Isaac has lashed south Florida with winds and heavy rain after battering the Caribbean.
The storm threatens to interrupt most US offshore oil production in the Gulf of Mexico and disrupt plans for the Republican National Convention in Tampa.
Isaac is expected to strengthen to a Category 2 hurricane and hit the Gulf Coast somewhere between Florida and Louisiana at midweek - on or near the seventh anniversary of Hurricane Katrina - the US National Hurricane Center (NHC) said in an advisory.
A hurricane warning was issued for the Gulf Coast from Louisiana to the Florida Panhandle, including New Orleans, which was devastated when Katrina struck the city on August 29, 2005, killing more than 1800 people and causing billions of dollars of damage to the Gulf Coast.
In Louisiana, Governor Bobby Jindal declared a state of emergency and said 15 low-lying parishes outside New Orleans' newly built, US$14.5 billion (NZ$17.87b) flood defence system would likely be under mandatory evacuation orders by late today (NZT).
"There's really nothing that's going to stop this storm from forming and from strengthening," said Jindal, a seasoned crisis manager who has weathered such disasters as the 2010 BP oil spill.
On Mississippi's Gulf Coast, residents started stocking up on supplies and securing their homes. "It is packed. They are clearing the shelves," said Lindy Stewart after shopping at a Sam's Club in Gulfport. Stewart said she bought bread, lunch meat and other "stuff you need to survive a couple of days without power".
The Mississippi State Port Authority ordered the port of Gulfport cleared of all cargo vessels and cargo containers.
Isaac is forecast to become a hurricane either tonight or tomorrow. The NHC said Isaac was expected to eventually intensify, with "extremely dangerous" sustained winds of 105mph (169kph) as it swept up the warm waters of the Gulf of Mexico.
Forecasters are predicting a more westward track that could bring Isaac over the heart of the US offshore oil patch, which produces about 23 per cent of US oil output and 7 per cent of its natural gas output.
SHUTTING OIL PRODUCTION
Meteorologists at Weather Insight, an arm of Thomson Reuters, predict the storm will spur short-term shutdowns of 85 per cent of the US offshore oil production capacity and 68 per cent of the natural gas output.
With the threat to offshore oil infrastructure and Louisiana refineries, US crude oil prices traded up US75 cents to US$96.90 a barrel in Asia trading today.
Once ashore, the storm could wreak havoc on low-lying fuel refineries along the Gulf Coast that account for about 40 per cent of US refining capacity.
That could send gasoline prices spiking just ahead of the US Labor Day holiday, analysts said. "It's going right in the heart of refinery row," Phil Flynn, an analyst with Price Futures Group in Chicago, said on Sunday.
London-based BP, the biggest US Gulf producer, said it was shutting production at all of its Gulf of Mexico oil and gas platforms and evacuating all workers yesterday.
At 5pm EDT (2100 GMT) on Sunday, Isaac was about 40 miles (65km) southwest of Key West at the southernmost tip of the US mainland, packing top sustained winds of 60 miles (100km) per hour, and churning southwest at 16 miles (26km) per hour.
Isaac was getting better organised and faced favourable conditions, increasing the possibility the storm could strengthen beyond a Category 2 hurricane, said NHC meteorologist David Zelinsky.
Tropical-force winds from the massive storm stretched across 400 miles (644km), with rain bands extending even further, he added.
"It certainly is a large storm," he said, noting that wind gusts of 60 mph (100kph) had been detected as far apart as Key West and Palm Beach.
The winds forced cancellations of hundreds of flights in and out of Miami, Fort Lauderdale and other south Florida airports. Miami Mayor Carlos Gimenez reported more than 500 cancellations affecting Miami International Airport alone.
More than half of the restaurants and other businesses were shuttered yesterday in the tourist haven of Key West after many visitors heeded official warnings to head home early. Isaac began moving away from the Florida Keys about noon today (NZT).