Tropical Storm Isaias formed on Wednesday in the warm waters off eastern Mexico. Forecasters say it will quickly strengthen and become a hurricane before it reaches the U.S. Gulf Coast later this week.

National Hurricane Center director Michael Brennan warned that Isaias could reach Category 3 strength, with winds of 178 km/h or higher, as it moves north toward the coast.

A hurricane watch now covers the northern Gulf Coast from Bay St. Louis, Mississippi, to Indian Pass, Florida. Governors Kay Ivey of Alabama and Ron DeSantis of Florida declared states of emergency for dozens of counties, and Alabama’s National Shrimp Festival was cancelled.

Oil producers responded quickly. About 25 % of Gulf offshore oil production—roughly 511,000 barrels per day—was temporarily shut down, and eight of the 371 manned platforms were evacuated, according to the Marine Minerals Administration.

The production cut comes as oil prices are already high, so even a moderate‑risk disruption can push markets higher. In addition, the storm threatens power, travel and local tourism, especially events like the shrimp festival that draw hundreds of thousands of visitors.