The floodwaters streamed into the city's streets from two levee breaks near Lake Pontchartrain a day after New Orleans thought it had escaped catastrophic damage from Katrina. The floodwaters covered 80 percent of the city, in some areas 20 feet deep, in a reddish-brown soup of sewage, gasoline and garbage.

Around midday, officials with the state and the Army Corps of Engineers said the water levels between the city and Lake Pontchartrain had equalized, and water had stopped spilling into New Orleans, and even appeared to be falling. But the danger was far from over.

The Army Corps of Engineers said it planned to use heavy-duty Chinook helicopters to drop 15,000-pound bags of sand and stone as early as Wednesday night into the 500-foot gap in the failed floodwall.

But the agency said it was having trouble getting the sandbags and dozens of 15-foot highway barriers to the site because the city's waterways were blocked by loose barges, boats and large debris.

In Washington, the Bush administration decided to release crude oil from the federal petroleum reserves after Katrina knocked out 95 percent of the Gulf of Mexico's output. But because of the disruptions and damage to the refineries, gasoline prices surged above $3 a gallon in many parts of the country.

The death toll has reached at least 110 in Mississippi alone. But the full magnitude of the disaster had been unclear for days — in part, because some areas in both coastal Mississippi and New Orleans are still unreachable but also because authorities' first priority has been the living.

In Mississippi, for example, ambulances roamed through the passable streets of devastated places such as Biloxi, Gulfport, Waveland and Bay St. Louis, in some cases speeding past corpses in hopes of saving people trapped in flooded and crumbled buildings.

State officials said Nagin's guess of thousands dead seemed plausible.

Lt. Kevin Cowan of the state Office of Emergency Preparedness said it is too soon to say with any accuracy how many died. But he noted that since thousands of people had been rescued from roofs and attics, it could be assumed that there were lots of others who were not saved.

"You have a limited number of resources, for an unknown number of evacuees. It's already been several days. You've had reports there are casualties. You all can do the math," he said.

On the flooded streets of New Orleans, dozens of fishermen from up to 200 miles away floated in on caravans of boats to pull residents out.

One of those rescued was 40-year-old Kevin Montgomery, who spent three days shuttling between the attic of a one-story home and a canopy he built on the roof.

Every once in a while, Mongtomery would see a body float by. But he cannot swim and had to fight the urge to wade in and tie them down.

"It was terrible," he said. "All I could do was pass them by and hope that God takes care of the rest of that."