Outside the broken shells of Biloxi's casinos, people picked through slot machines to see if they still contained coins and ransacked other businesses.

"People are just casually walking in and filling up garbage bags and walking off like they're Santa Claus," said Marty Desei, owner of a Super 8 motel.

Insurance experts estimated the storm will result in up to $25 billion in insured losses. That means Katrina could prove more costly than record-setting Hurricane Andrew in 1992, which caused an inflation-adjusted $21 billion in losses.

Oil prices jumped by more than $3 a barrel on Tuesday, climbing above $70 a barrel, amid uncertainty about the extent of the damage to the Gulf region's refineries and drilling platforms.

By midday Tuesday, Katrina was downgraded to a tropical depression, with winds around 35 mph. It was moving northeast through Tennessee at around 21 mph, with the potential to dump 8 inches of rain and spin off deadly tornadoes.

Katrina left 11 people dead in its soggy jog across South Florida last week, as a much weaker storm.

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Contributing: Holbrook Mohr, Mary Foster, Allen G. Breed, Brett Martel, Adam Nossiter, Jay Reeves