Hurricane Ike in Gulf of Mexico, headed for Texas

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Hurricane Ike gathered strength as it churned through the Gulf of Mexico's warm waters on Thursday on a track that would skirt the heart of the U.S. offshore oil patch before slamming into the Texas coast late on Friday or early on Saturday.

HOUSTON (Reuters) - Hurricane Ike gathered strength as it churned through the Gulf of Mexico's warm waters on Thursday on a track that would skirt the heart of the U.S. offshore oil patch before slamming into the Texas coast late on Friday or early on Saturday.

Ike is a Category 2 storm with 100 mph (160 kph) winds and could come ashore as a ferocious Category 4 storm on the five-step intensity scale with winds of 132 mph (213 kph), the National Hurricane Center said.

But the latest projections pointed Ike toward the middle of the Texas coast, skirting to the west of the main region for offshore production in the Gulf, which provides a quarter of U.S. oil and 15 percent of its natural gas.

Crude oil prices were trading just above a five-month low of $101.36 per barrel set on Wednesday as weak demand and a strong dollar offset a surprise OPEC production cut agreement and hurricanes in the Gulf of Mexico that have cut deeply into U.S. energy supplies.

At 5 a.m. EDT on Thursday, the hurricane center said in its latest advisory Ike was 620 miles east of Brownsville, Texas, and about 285 miles south-southeast of the mouth of the Mississippi River. It was moving west-northwest at 9 mph (15 kph).

New Orleans, still scarred by Hurricane Katrina, which killed 1,500 people and caused $80 billion in damage on the U.S. Gulf Coast in 2005, appeared to be out of danger.

However, the center early on Thursday extended a tropical storm warning as far east as the Mississippi-Alabama border, including New Orleans and Lake Pontchartrain. A hurricane watch remained in effect from Cameron, Louisiana west to Port Mansfield, Texas.

Texas officials ordered some residents in low-lying Matagorda and Brazoria counties to evacuate. Mandatory evacuations had been illegal in Texas but the state changed its laws after Hurricane Rita in 2005. So far evacuation totals are nowhere near the 2 million people who fled Louisiana coastal cities in the path of Hurricane Gustav.

Other residents were boarding up homes and businesses to prepare for hurricane-force winds that could arrive on Friday.

"Right now, we have people coming in and out," said Steve Probert, who works at a hardware store in the resort community of Port Aransas, across the Laguna Madre from Corpus Christi. "They're buying everything we have under the sun."

President George W. Bush declared a federal emergency for Texas, allowing some federal disaster assistance.

BUSES NOT BODY BAGS

Ike's current track would see it hit the Texas coast just north of Corpus Christi, a major Gulf Coast oil refining hub.

About 250 miles of Texas coastline from Matagorda Bay to Brownsville on the Mexico border are on alert for possible mandatory evacuations due to wide uncertainty over the storm's path. A line of buses made their way from Corpus Christi to inland shelters as the city evacuated some elderly and sick residents.

Some residents in Brazoria County south of the low-lying coastal city of Galveston were ordered to evacuate.

Texas Gov. Rick Perry said that some resident would likely resist evacuation calls but said he wants to see "buses, not body bags." Perry put 1,350 buses on standby to carry possible evacuees.

"We must have passed 50 or more people taking their boats and probably every mobile home in the state was on the road," said Margaret Romero, 67, who evacuated from Corpus Christi on Wednesday. "Our entire street -- every house on our street was boarded up."

Torrential rains from the storm could be more damaging than its wind blasts, especially for heavily populated areas in the Rio Grand Valley which already took a soaking from Hurricane Dolly in July.

Ike could unleash up to four inches of rain on southern Louisiana, and produce storm surges up to five feet

above normal tide levels, along with large and battering waves in some parts of the Gulf on Thursday, the center forecast.

CUBA TAKES DIRECT HIT

In Cuba, big waves and storm surges were expected to subside, but heavy rains on the island's western end could produce flash floods and mudslides, it said.

Ike has already caused widespread damage in Cuba.

Few official figures have emerged, but state-run media showed a panorama of destruction across the island, still reeling from the more powerful Hurricane Gustav 10 days ago.

Ike struck eastern Cuba on Sunday with 120 mph (195 kph) winds and torrential rains that destroyed buildings, wiped out the electricity grid, toppled trees, leveled crops including sugar cane fields and turned rivers into roaring torrents.

A total of 2.6 million people were evacuated before Ike, or about 22 percent of the country's 11 million population, but officials said four people died in the eastern provinces.

Before Cuba, Ike hit Britain's Turks and Caicos Islands and the southern Bahamas as a Category 4 hurricane.

Floods triggered by its torrential rains were blamed for at least 71 deaths in Haiti, where Tropical Storm Hanna killed 500 people last week.

(Additional reporting by Jeff Franks, Esteban Israel, Marc Frank, Rosa Tania Valdes and Nelson Acosta in Havana, Jim Forsyth in San Antonio, Jim Loney in Miami; Editing by Doina Chiacu and Eric Walsh)