Hurricane Ivan skirted the western tip of Cuba on Monday and arced into the Gulf of Mexico with sustained winds of 160 mph, bearing down toward landfall on the U.S. Gulf Coast later this week.

Gulf Coast residents from the Florida Panhandle to Louisiana made preparations in case of a direct hit by Ivan, a Category 5 storm predicted to hit the mainland possibly on Wednesday. A hurricane watch for a large stretch of the region was issued late Monday. While some forecasters said the storm might weaken over the cooler waters of the northeastern Gulf of Mexico, Max Mayfield, director of the National Hurricane Center in Miami, said it would still be "very formidable."

"It's going to hit somebody," he was quoted as saying by the Associated Press. "This is a very, very dangerous hurricane." The mayor of New Orleans urged residents to leave as soon as possible.

The storm was moving north-northwest at 9 mph and was expected to resume a more northwestward trajectory overnight, according to the hurricane center. Residents of the Florida Keys and parts of Florida hit by two hurricanes in the last month expressed relief as forecasters said the danger of a third striking the area had receded.

In Key West, Fla., officials lifted an evacuation order that had virtually emptied the 120-mile island chain since last Thursday. "We're obviously very relieved that the storm is passing to the west of us," said Greg Artman, a spokesman for the Keys' Monroe County Emergency Management. A tropical storm watch remained in effect on Monday.

Having killed at least 68 people and caused billions of dollars of damage on its drive across the Caribbean, Ivan triggered a state of emergency in Cuba's lush tobacco valleys and prompted U.S. oil companies to abandon rigs in the Gulf of Mexico.

The evacuation of offshore drilling platforms pushed up the price of crude oil futures in New York by more than $1 a barrel to $43.87. The slow-moving hurricane that ripped Grenada, Jamaica and the Cayman Islands whipped up winds in Cuba and Mexico's Yucatan Peninsula.

Cuban President Fidel Castro toured the western valleys of the island on Monday, urging people to flee to higher ground and prepare for flooding. World-famous Cuban cigars are made from tobacco grown in the region and are an important source of income for Cuba, which has already suffered more than $1 billion in storm damage this season. Throughout the island, more than 1 million people were reported to be taking shelter.

"This year has been a bad one," Celio Ariel Reyes, an employee at the Hotel Pinar del Rio, in western Cuba, said in a telephone interview. He said the wind was gusting at 68 mph and the rains were lashing down as he spoke. He said people were so worried they had cut down trees to prevent them from smashing through windows, taped up doors and stockpiled food.

Last month, Hurricane Charley caused considerable damage in Cuba. "A lot of people were without electricity for 13 days after the last hurricane, and Ivan is more violent," Reyes said.

Thousands of people in Mexico's resort city of Cancun fled the beaches and moved inland as city officials prepared shelters. Almost all of the 1,800 people on the northern Yucatan island of Holbox jammed onto ferries and left for the mainland.

Alberto Saab, a Holbox hotel owner, reached by telephone, said he was one of the "few crazy people" left on the pretty fishing island. All of his guests had departed, he said.

"I have been tracking Ivan for days and days, and now it is here. The rains have started," Saab said. But he added he was anxious to see what it would do to his tiny island, after thousands were left homeless in the Cayman Islands and Jamaica.

Jaime Aguilar, port director in the Yucatan state of Quintana Roo, said people had been urged to evacuate more than 130 miles of coastline from Holbox to Tulum.

The port of Cozumel, where tens of thousands of cruise ship passengers usually arrive weekly, was shut down. Isla Mujeres, another island north of Cozumel, reported massive waves and torrential rain late Monday. Most residents and tourists had left, officials said.

Matt Carmichael, a spokesman for ChevronTexaco, said his company began evacuating nearly 1,000 workers from the Gulf of Mexico Monday morning. His company, Shell Oil and many others in the area were shutting down oil and natural gas operations. "We see Ivan as extremely dangerous," he said.

Staff writer Manny Fernandez in Key West contributed to this report.

Cubans brace against heavy wind and rain in Pinar del Rio as Hurricane Ivan churned toward the Gulf of Mexico.Rick Brasher works to secure a cafe in Panama City, Fla., ahead of the storm.