Edouard, the fifth tropical storm of the 2008 Atlantic hurricane season, was just shy of hurricane strength when it came ashore halfway between High Island and Sabine Pass, forecasters said.
The storm will weaken as it moves inland, the U.S. National Hurricane Center said in a 8 a.m. EDT report.
The storm formed near a major oil- and gas-producing area of the northern Gulf of Mexico on Sunday and had previously been forecast to come ashore farther south, near Galveston.
A storm surge of 2 to 4 feet was expected for coastal areas between Grand Isle, Louisiana, and Sargent, Texas, the Miami-based center said. The storm's sustained winds fell just short of hurricane speeds of 74-mph (119-kph).
Flooding was the primary concern. The storm could cause rain accumulation up to 5 inches in coastal regions of Louisiana and up to 10 inches in some parts of southeastern Texas, U.S. forecasters said.
Texas Gov. Rick Perry on Monday declared 17 counties disaster areas and mobilized about 1,200 National Guard troops. In Louisiana, Gov. Bobby Jindal declared a statewide emergency.
Isolated tornadoes were possible.
Though Galveston's west side could see some flooding, officials on the barrier island did not order evacuations.
"Our biggest concerns right now are power outages and street flooding," said Mark Sloan, emergency management coordinator for Harris County. "It shouldn't be that big a deal for us."
OIL OPERATIONS
Edouard, the second named storm to threaten oil operations in the Gulf of Mexico this year, shut down a huge offshore oil port, closed the Houston Ship Channel and prompted several offshore operators including Chevron Corp and Shell Oil to evacuate staff from their platforms. But energy companies reported little production slowdown.
The Gulf of Mexico supplies about a quarter of the nation's crude oil and 15 percent of its natural gas, while refiners along the coast produce about a quarter of domestic gasoline.
U.S. crude oil futures fell as low as $118 a barrel on Tuesday, the lowest price since May 5, as traders discounted the possibility of widespread disruptions from the storm.
The Louisiana Offshore Oil Port, the only deep-water U.S. oil port and a major conduit for the country's crude oil imports, said it temporarily suspended offloading oil tankers in the Gulf of Mexico due to high waves and winds.
A series of powerful hurricanes in 2004 and 2005, including Hurricane Katrina, toppled oil rigs and severed pipelines in the gulf.
The six-month hurricane season, which began on June 1, has already seen two of this year's storms strengthen into hurricanes. Last month was the third most active July for storms since records began in 1851.
(Additional reporting by Michael Christie in Miami, Anna Driver and Erwin Seba in Houston; editing by Bill Trott)
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