Sept. 21 (Bloomberg) -- Hurricane Rita strengthened into a Category 5 storm as it moved across the Gulf of Mexico toward Texas and Louisiana, surpassing the power Katrina had when it swept ashore last month and became the most expensive natural disaster in U.S. history.

Rita has winds of 165 mph, putting it in the highest intensity level on the Saffir-Simpson scale, the National Hurricane Center said. Officials in coastal Texas towns from Corpus Christi north to Galveston have urged or ordered millions of residents to leave. Exxon Mobil Corp. and other oil producers have shut down offshore platforms that were spared by Katrina.

The storm's reach may extend anywhere from northeast Mexico to along the Texas coast and up to the western half of Louisiana, center spokesman Frank LePore said. Texas Governor Rick Perry told people to begin readying themselves to seek higher ground.

``I encourage coastal residents, in a calm fashion, to gather important documentation, secure their property to the best of their ability; fill up their gas tanks; pack water, non- perishable goods, flashlights, batteries, an adequate supply of medicines; study their local evacuation routes; begin proceeding to more secure areas in an orderly and safe manner,'' Perry said.

Category 5 hurricanes have winds of 156 mph or stronger and storm surges more than 18 feet above normal. Such storms can knock down trees, shrubs and signs and completely destroy mobile homes, as well as obliterate roofs and blow out doors and windows.

Ninth Hurricane

Rita, the ninth hurricane and 17th named storm of the six- month Atlantic hurricane season, was about 600 miles (965 kilometers) east-southeast of Galveston as of 4 p.m. local time, the center said. This is the first time in 10 years that Atlantic tropical storms and hurricanes, named in alphabetical order, have reached the letter ``R.''

``Anything Category 5 and above is likely to cause catastrophic damage,'' LePore said in an interview.

Since record-keeping began, only three Category 5 storms have hit the U.S.: one that hit the Florida Keys in 1935; Hurricane Camille, which hit Mississippi in 1969; and Andrew, which devastated southern Florida in 1992.

Hurricane Katrina hit Louisiana as a Category 4 with winds of 140 mph after earlier packing gusts as strong as 175 mph as it moved over the warm waters of the Gulf. The storm killed more than 1,000 people in Louisiana, Mississippi and Alabama, destroyed coastal towns, submerged most of New Orleans and disrupted U.S. oil supply.

Oil Production Threatened

The threat Rita poses to oil rigs, refineries and platforms in the Gulf pushed the price of crude oil and gasoline higher. Texas is the producer of a quarter of the nation's refined fuel.

``The Houston area is ground zero of the refining industry,'' said Rick Mueller, an analyst with Energy Security Analysis Inc. in Tilburg, the Netherlands. ``If it suffers the scope of damage caused to refineries in Louisiana by Katrina, we could see rationing and queues at the gas pump. This is something OPEC can't do anything to remedy.''

U.S. President George W. Bush today declared an emergency exists in Texas and Louisiana. The Federal Emergency Management Agency is putting truckloads of ice, water and food as well as urban search and rescue task forces and medical teams in staging areas in Florida and Texas, the agency said in a statement. Several military ships are moving east to avoid Rita.

`Ready'

``We are comfortable that Texas is going to be ready for this storm,'' Acting FEMA director David Paulison said at a televised press conference. ``It's not going to be fun. It's a big storm.''

Perry yesterday recalled National Guard members sent to help the Katrina recovery effort so they could help in the state's preparations for Rita. He signed a proclamation stating Rita posed a ``threat of imminent disaster'' along the 367-mile Texas coast and the state Army National Guard mobilized 5,000 personnel and 11 helicopters.

Rita was moving west at about 13 mph and hurricane-force winds extended 70 miles from the center. It is forecast to turn toward the northwest over the next three days, making landfall somewhere in an area from near the Texas-Mexico border to western Louisiana.

Houston Mayor Bill White asked people living in low-lying areas and mobile homes of Harris County, which contains the city, to begin making plans to leave. There will be a mandatory evacuation of all people in flood-prone areas starting at 6 a.m. tomorrow. Harris County has 3.6 million people, according to the 2003 census.

Port Closed

The Port of Houston, the world's sixth-largest port and biggest in the U.S. by foreign tonnage, closed at 5 p.m. local time. The Port Authority is hoping to re-open the site by Monday to avoid a major disruption of business, said Chairman James Edmonds.

Four Houston-area hospitals owned by HCA Inc., the largest U.S. hospital chain, are among those moving out critical-care patients and considering evacuating other patients. The Houston area has 72 hospitals. At least two hospitals in Galveston County and five in Brazoria County have begun moving patients, the state hospital association said today.

NASA's Johnson Space Center in Houston closed today because of Rita and stay shut until the hurricane passes. The National Aeronautics and Space Agency will transfer primary flight control of the International Space Station to the Russian Mission Control Center, the agency said in a statement.

``Hurricane Rita, on its present course, poses a risk to Houston and the whole Houston region,'' White said during a televised press conference.

Galveston

Houston and Galveston, about 50 miles to the southeast, are moving Katrina evacuees to safer locations ahead of Rita. Galveston, which started running buses today, is the site of the worst natural disaster in U.S. history -- a hurricane that killed 8,000 to 12,000 in 1900.

Thousands of evacuees were moved yesterday from Houston to Fort Chaffee, Arkansas, and Tennessee. Houston contains estimated 200,000 Katrina evacuees, most in the nation, and has the world's largest concentration of oil companies.

St. Paul Travelers Cos. may have to abandon the Hurricane Katrina response center it set up in Houston, the fourth-largest U.S. city.

`A Challenge'

``We are making provisions and plans for evacuating that site if need be over the next couple of days,'' said Ray Stone, St. Paul's vice president of catastrophe operations. ``This is going to be a challenge.''

Galveston, which declared a state of emergency yesterday, began evacuating nursing homes and assisted living facilities today, removing 1,500 people so far. All other residents will be required to leave at 6 p.m. local time tonight.

Similar evacuations are going on in neighboring Brazoria County and in San Patricio County, near Corpus Christi. The city of Corpus Christi ordered evacuation of several islands.

``With this type of track here and with an intensity of the storm, which will likely be either a strong Cat 3 or Cat 4 during landfall, the storm surge across that area could get up to as much as 15, even 20 feet or more,'' said Mark Russo, a meteorologist at Chesapeake Energy in Corp. in Chicago. ``Those low-lying areas, especially in the Galveston area, would likely take the brunt of the storm surge.''

Daily natural-gas output slipped to about 5.287 billion cubic feet from 6.518 billion yesterday, and oil production dropped to 402,643 barrels from 622,725 barrels, according to figures released today by the Minerals Management Service.

Production Shut Down

About 47 percent of normal Gulf gas output and 73 percent of oil production are shut, according to the service, an arm of the U.S. Interior Department.

Oil companies including Exxon Mobil, Royal Dutch Shell Plc and Chevron Corp. have begun evacuating workers from rigs and platforms near the two states. About 30 percent of U.S. oil production comes from platforms in the Gulf, and 44 percent of U.S. refining capacity is in Louisiana and Texas. The Texas Gulf Coast has seven of the 13 largest U.S. refineries.

The threat to the region already devastated by Katrina prompted New Orleans Mayor Ray Nagin to halt plans for residents to return. The city's levees are being reinforced with sheet metal to prepare for 2 inches to 4 inches of rain and higher- than-usual tides in the greater New Orleans area resulting from Rita, said FEMA spokesman David Passey.

Evacuations are expected for the 2,447 Katrina victims in shelters in Calcasieu and Cameron parishes, which are in the southwestern corner of the state and in the projected path of Rita, said Terri Ricks, undersecretary of the Louisiana Social Services Department.

State authorities are beginning to evacuate 236 elderly, sick, other special-needs Katrina survivors and their caregivers from shelters in Lake Charles, Lafayette and Thibodaux, Louisiana to communities in the northern part of the state, she said.

Florida Keys

Rita yesterday passed south of the Florida Keys, depositing debris on roads, flooding some areas and leaving as many as 24,800 customers without power, according the state Emergency Management Division.

Residents who evacuated have been permitted to return today, officials said.

To contact the reporter on this story: Heather Burke in New York at hburke2@bloomberg.net.

Last Updated: September 21, 2005 18:20 EDT