Katrina was a category 5 hurricane, this one is, according to the up-to-the-minute updates from the NYT tracking service, more likely to become a category 1, which could dip into category 2 very briefly.

The damage we're likely to see on the oil rigs are going to be much less severe than what happened with Katrina. Part of it is simply because it's far weaker. The second part is that post-Katrina a lot of new improvements were made to increase the toughness of the rigs. And after the Deepwater Horizon spill was this done even more.

The crude oil production isn't the problem here.

What may be a problem is the refineries, or at least a part of them. Almost 50 % of all U.S. refinieres come from that area, while only 10 % of all crude oil production does. So the price is gas, which is much more vulnerable to refineries than raw crude oil production, is the most likely candidate to suffer.

This probably means that the SPR will be released, since gas price futures are already rising very fast, even pre-Isaac.

The last time gas futures reached those levels, the price of gas was around $3.98. And this chart is already about 4 days old.

It remains to be seen if a release of the SPR, which I consider to be very likely by now, will stop the march towards $4.00 gas.
And if the barrier is breached, for how long it would stay there.

And that duration depends in large part of the damage done on the refineries.

Edit:

Here is the NYT tracking service, it works really well.
http://www.nytimes.com/interactive/2012/08/26/us/hurricane-isaac-map.htm...

So now it won't even be a category 2, and it might not even become a category 1 hurricane at all. This is good news.
It remains to be seen if there a surprise to the downside but each passing hour has thus far meant a decrease in it's strength.
That's likely to continue and be a mostly non-event as hinted earlier.

Evacuations: Apparent a lot of folks in La. are taking the storm serious despite its low strength. I was on I-10 east of Houston this morning at 0530 and traffic was unusually heavy coming from the east (La.). Normally 65 mph with few vehicles but closer to 45 mph with a lot. Didn't catch many license plates but some were La. Lots of folks in S. La. have family/friends in the Houston area so it makes sense. Just a bit surprising to see such a noticeable movement.

I'm guessing that the major impact from this storm will be widespread power outages, with localized heavy flooding. I would think that the power outages are going to make it more difficult to get the refinery and product transportation network back up and running.

Obama is about to make some comments about the storm. It occurs to me that the most sensible thing he could do would be to ask people to curtail their driving, heading into the Labor Day weekend, given the probability that we are headed for actual spot shortages of gasoline, but the betting seems to be that he will talk about, IMO, a basically useless release of crude from the SPR.

Edit: Obama did not mention either the SPR or gasoline consumption.

http://www.wunderground.com/blog/bnorcross/show.html?entrynum=8
Bryan Norcross' Official Blog
11:33 AM GMT on August 28, 2012

The track is pretty clear now. The center should come ashore near the Mississippi River Delta, the far southeastern tip of Louisiana. This track will put the highest winds over New Orleans that the city has seen in decades. And, it will be relentless. Winds will pick up during the day today with the strongest winds in the city this evening and overnight. Then the pounding will only slowly recede tomorrow.

Strong onshore winds will also affect the Mississippi, Alabama, and Florida Panhandle, but the track of the center into Louisiana will mean the winds farther east won't be perpendicular to the coast, which will keept the storm surge heights a little less that they would have been with a track farther east. Still a maximum of 4 to 8 feet of water above the land is forecast for the Alabama coast, and 3 to 6 feet in the Panhandle. Storm surge flooding is continuing to affect low lying areas in the Florida Peninsula due to the large area covered by the circulation.

The highest storm surge - the forecast continues to be 6 to 12 feet - will be on the Gulf side of southeast Louisiana and in Mississippi. This won't be Katrina, but life-threatening high water will be pushed over the coast today and tonight. The onshore winds will keep the water high for an extended period. Low-lying areas inland will be especially dangerous due to flooding rains that can't drain at their normal rate.

Most of the deaths following hurricans are in fact not directly related to hurricanes, but follow consequences of the aftermath(i.e. robberies gone wrong, fallen trees on the road around a corner that the drivers fail to anticipate and so on).

For example, Hurricane Rita in 2005 had an impact of about 120 deaths.
Of those 120 deaths only 7 were deemed 'direct deaths'.

The biggest danger of a hurricane is actually after it has happened.
A lot of people let their guard down at that moment and it's precisely then that the vast majority of people die.

It's Official now. Hurricane Issac

000
WTNT64 KNHC 281618
TCUAT4

HURRICANE ISAAC TROPICAL CYCLONE UPDATE
NWS NATIONAL HURRICANE CENTER MIAMI FL AL092012
1120 AM CDT TUE AUG 28 2012

...RECONNAISSANCE DATA INDICATE ISAAC FINALLY ACHIEVES HURRICANE
STATUS...

REPORTS FROM AN AIR FORCE RESERVE HURRICANE HUNTER AIRCRAFT
INDICATE THAT MAXIMUM WINDS ASSOCIATED WITH ISAAC HAVE INCREASED
TO 75 MPH...120 KM/H. ON THIS BASIS...ISAAC IS BEING UPGRADED TO
A HURRICANE.

SUMMARY OF 1120 AM CDT...1620 UTC...INFORMATION
-----------------------------------------------
LOCATION...28.1N 88.6W
ABOUT 75 MI...115 KM SSE OF THE MOUTH OF THE MISSISSIPPI RIVER
ABOUT 160 MI...250 KM SE OF NEW ORLEANS LOUISIANA
MAXIMUM SUSTAINED WINDS...75 MPH...120 KM/H
PRESENT MOVEMENT...NW OR 310 DEGREES AT 10 MPH...17 KM/H
MINIMUM CENTRAL PRESSURE...975 MB...28.79 INCHES

$$
FORECASTER STEWART/BEVEN

The real trouble begins after Isaac is gone

... With the economy still foundering, and the unemployment rate for most of the Gulf Coast region still above 8%, plenty of folks have no savings to pay for shelter or even to fill the gas tank for the drive inland. Those who must leave their jobs behind will have smaller paychecks to draw on when the credit card bills arrive at the end of the month. The longer they must stay away, the greater the financial setback they will face.

This storm looks to be churning up water in the general area of the Deepwater Horizon - anybody know if this is likely to bring old spilled oil to the surface and or shore?

Troops deployed as Hurricane Isaac targets New Orleans

"Citizens have to be prepared. I'm going to ask you to hunker down," Landrieu said, as hundreds of U.S. Army National Guard troops took up strategic positions around New Orleans.

Brandishing automatic assault rifles to ward off any threat of looting, the troops in military vehicles took up positions on mostly deserted streets. Their arrival came as driving rain and stiff winds began battering the city's iconic French Quarter and its boarded-up storefronts.

Earlier, the Army Corps of Engineers closed for the first time the massive new floodgate on the largest storm-surge barrier in the world, at Lake Borgne, east of New Orleans.

As of now, refiners have reduced output about 1,000,000 bpd of oil products per day. So far the biggest oil and/or oil product pipeline to be shut is the Capline Pipeline. That was shut Saturday evening and has an capacity to transport 1.2 million bpd of oil to Midwest refineries. It is not clear what, if any, impact the Capline shutdown has had on refiners further inland so far.

The largest US pipeline system for oil products, the Colonial Pipeline was still operating normally. They improved their ability to weather power interruptions after prior hurricanes:

Isaac to Test Power System Upgrades After Katrina’s Blackouts
By Julie Johnsson, Mike Lee and Mark Chediak - Aug 28, 2012 6:13 PM ET
http://www.bloomberg.com/news/2012-08-28/isaac-to-test-power-system-upgr...

Update:
Valero Energy Corp. said Tuesday it could reduce rates at its refinery in Memphis, Tenn., due to the closure of the Capline pipeline. "We could reduce rates on Memphis because of that, depending on how long it stays down," Valero spokesman Bill Day said.
http://online.wsj.com/article/SB1000087239639044450600457761763047722042...

The first waiver related to Hurricane Isaac was issued today by the EPA as a result of actual or potential transport fuel shortages in the affected region.

Quite typically a waiver is granted when gasoline supplies are limited that allows a blend of gasoline with a RVP (Reid Vapor Pressure) other than that normally used in that season.

Usually Summer-blend gasoline has a lower Reid vapor pressure, meaning it creates less vapor than winter-blend gasoline and is less likely to contribute to smog formation in higher temperatures. It is a more complicated refining process to produce gasoline with lower RVP. If faced with a shortage of low vapor pressure gasoline, individual States can and usually do request exemptions from the Environmental Protection Agency to use what gasoline is available - which will probably be a leftover 'winter blend'.

EPA grants Louisiana partial fuel waiver request

This waiver will enable Louisiana refineries in 14 parishes the latitude to utilize slightly higher Reid Vapor Pressure (RVP) fuels from today until September 6 in order to assist with the shortages currently being experienced as a result of the evacuation due to Hurricane Isaac. Since the majority of parishes will be using the same type of gas, it will make it easier for fuel distributors and gas stations to keep gas at the pumps.

http://www.wafb.com/story/19399083/epa-grants-louisiana-partial-fuel-wai...

I'm unfortunately hearing lots of damage reports on local news channels as Isaac stalls. Not good :-(

The temporary stall and slow drift to the west was well predicted on many models but the NHC decided to downplay that scenario.

Plaquemines Parish President says many people trapped in homes and they cannot reach them. Flooding worse than Katrina in parts he says. He says it feels far worse than a Cat 1 to him.

Widespread power outages. Mayor Mitch Landrieu says 75% of city without power. Main pump stations though for city are all still operating he says and main city protection still intact.

Hurricane Isaac Makes Landfall as New Orleans Hunkers Down

Hurricane Isaac pounded New Orleans and the northern Gulf Coast, delivering gale-force winds, heavy rain and the promise of flooding across an area from Louisiana’s southern coast to the Florida Panhandle.

...Isaac has stopped 93 percent of U.S. oil production in the Gulf of Mexico and 67 percent of natural-gas output, and forced evacuations from 503 production platforms and 49 rigs, the Bureau of Safety and Environmental Enforcement said yesterday. Six Louisiana refineries were shut.

President Barack Obama declared a state of emergency in Louisiana and Mississippi. He said federal response teams are ready.

Oh Crap!

A man reports there is sewage in the street. An official phones in and says they had the problem with Gustav also. There are 500 sewage lift stations (NOT pump stations he is at pains to point out) and most of them don't have backup power because of budget limits.

If you have sewage backing up, go into the garden and pop the sewage cap. Rather flood the garden with sewage than the house. And use the toilet sparingly.

Dam nears collapse due to Isaac; thousands reportedly evacuating

Up to 50,000 people in Louisiana's Tangipahoa Parish were ordered to evacuate Thursday morning when water from Tropical Storm Isaac threatened to overwhelm a dam across the state line in Mississippi.

Residents were given just 90 minutes to leave, parish spokesman Jeff McKneely told NBC affiliate WDSU-TV.

The parish said "imminent failure" of the dam was expected.

The dam at Lake Tangipahoa, better known as Percy Quin State Park, has been damaged by the torrential rains from Hurricane Isaac. As of about 20 minutes ago, a National Guard helicopter was maintaining position over the dam to monitor its integrity.

Asked where the evacuees would be transported, Burgess told WWL, “We don’t know yet. I just got to get them out away from the river.”

Burgess says residents - between 50,000 and 60,000 of them - have a little less than an hour to clear out. The evacuation order is aimed at residents along the Tangipahoa River, from Kentwood to Robert, Louisiana.

Oil, Gas Companies Assess Damage in Isaac's Wake

Some problems have emerged, however. Phillips 66 said it found some flooding at its 247,000-barrel-a-day refinery in Belle Chasse, La., in Plaquemines Parish, the area that suffered the initial brunt of the hurricane. "Refinery personnel are working to prevent more flooding and to pump water out of the flooded areas," the company said.

The Louisiana Offshore Oil Port, where giant tankers unload overseas crude oil, expected to resume delivering oil Thursday evening from its Clovelly onshore facility, spokeswoman Barb Hestermann said. LOOP had restarted deliveries Wednesday night from its St. James, La., facility.

One odd thing about hurricanes: occasional situations that don’t fit the overall pattern. My producing well, just 15 miles south of Baton Rouge, which is reported to have gotten 12” to 15” of rain, was not only undamaged but had no standing water on the location. I was concerned we might have floating oil tanks. In fact, from the photos my hand sent me it doesn’t even look like it hardly rained there. But that the nature of those rain bands. I remember once sitting not very far from the eye when, after a rain band had past, I could see small patches of blue before the next band came swopping in.