Hurricane Katrina was undoubtably a record-breaking storm. It formed on August 23, 2005, and in less than a week, grew from a tropical depression into a Category 4 hurricane. At its peak, it became a Category 5 Hurricane, with winds up to 175 mph.
Although heavy winds contributed to the damage Katrina caused, flooding was the most destructive aspect of the hurricane. Before Katrina even made landfall, its storm surge caused the levees protecting New Orleans, LA and its surrounding suburbs to fail. After landfall, Katrina left 80% of the city under water – up to 20 feet deep in some areas. This devastating flooding affected more than 100,000 homes and business, leaving more than 30,000 people stranded and almost 2,000 dead.
As the largest and third strongest hurricane to make landfall in the U.S., Katrina’s devastating effects were not only felt regionally, along the Gulf Coast, but across the nation.
The day after Katrina made landfall, 95% of oil production ceased in the Gulf of Mexico, a key supply point for the U.S. In fact, at the time, the Gulf represented approximately 29% of all domestic oil production and 47% of the nation’s 17 million barrels a day refining capacity. This drop in production, in combination with the shutdown of many refineries throughout the region caused gas prices across the nation to surge to $3.78 a gallon, a 50-cent jump from the previous day.
Reports of gas shortages, in combination with rising prices, caused panicked consumers to rush to the pumps to top of their tanks. This left many service stations out of gas, having to post “out of gas” signs at their pumps. With 2.3 million facing power loss, businesses also began to panic, knowing they were in a fight again the clock before their generators ran out of fuel – the survival of their operations dependent on when they received their next fill.
More than ten months later, the effects of Katrina lingered; among many economic woes, oil production was depressed by 30%. As a result, thousands lost their jobs and were forced to move to other cities. Some of the hardest hit industries within the region were education, finance, healthcare and hospitality.
The total economic impact is estimated to be $250 billion, making Hurricane Katrina the costliest natural disaster in U.S. history.
It’s been 15 years since this powerful hurricane hit and with a record-breaking hurricane season already underway, there’s many lessons we can take from Katrina and apply to current business continuity planning. Next week, we’ll be sharing a post dedicated to these lessons.
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