As the center of Hurricane Katrina passed southeast of New Orleans on August 29, 2005, winds downtown were in the Category 1 range with frequent intense gusts and tidal surge. Hurricane-force winds were experienced throughout the city, although the most severe portion of Katrina missed the city, hitting nearby St. Bernard and Plaquemines parishes. Hurricane Katrina made its final landfall in eastern St. Tammany Parish. The western eye wall passed directly over St. Tammany Parish, Louisiana as a Category 3 hurricane at about 9:45 am CST, August 29, 2005. The communities of Slidell, Avery Estates, Lakeshore Estates, Oak Harbor, Eden Isles and Northshore Beach were inundated by the storm surge that extended over six miles inland. The storm surge affected all 57 miles (92 km) of St. Tammany Parish’s coastline, including Lacombe, Mandeville and Madisonville. The storm surge in the area of the Rigolets Pass was estimated to be 16 feet, not including wave action, declining to 7 feet (2.1 m) at Madisonville. The surge had a second peak in eastern St. Tammany as the westerly winds from the southern eye wall pushed the surge to the east, backing up at the bottleneck of the Rigolets Pass.
In the City of New Orleans, the storm surge caused approximately 23 breaches in drainage canal and navigational canal levees and floodwalls. The failures of structures are considered by experts to be the worst engineering disaster in the history of the United States. By August 31, 2005, 80% of New Orleans was flooded, with some parts under 15 feet (4.6 m) of water. The famous French Quarter and Garden District escaped flooding because those areas are above sea level. Responsibility for the performance of the city's levees belongs to the United States Army Corps of Engineers. The major breaches included the 17th Street Canal levee, the Industrial Canal levee, and the London Avenue Canal floodwall. These breaches caused the majority of the flooding, according to a June 2007 report by the American Society of Civil Engineers. The flood disaster halted oil production and refining which increased oil prices worldwide.