Katrina broke oil rigs moorings in the Gulf of Mexico and could end up being the most costly hurricane in US history. Some estimates are already putting the bill to insurers at US$26 billion ($34.6 billion).

The hurricane, which ploughed through the Gulf before hitting New Orleans, shut nearly all of the region’s oil production and closed eight refineries.

Chevron, Shell and Exxon Mobil shut offshore oil and gas production and evacuated staff as Hurricane Katrina approached.

Apache also braced for the storm, shutting-in about 70 000 barrels of oil and 565 million cubic feet of gas per day in the Gulf and onshore Louisiana. The company said it shut 336 of its 386 structures as the storm began affecting its onshore facilities.

Apache would not speculate on damage or a timetable for restoring production.

It had only recently reached full production, following last September’s Hurricane Ivan, which wiped out a total of 45 million US oil barrels over six months.

Crude oil prices soared to record highs above US$70 per barrel last night, before settling at $67.20, up a $1.07, as dealers wait for word of the damage to oil installations.

Oil companies are uncertain whether Katrina has caused damage to infrastructure. But Shell has reported that two of its oil drilling rigs were adrift.

The Bush administration has said it was willing to consider lending crude oil from the government’s stockpile upon request to the US refiners facing delayed shipments.