Hurricane Bill, the first of this year's Atlantic season, gathered strength and grew into a dangerous Category 4 storm with sustained winds of up to 215 km/h today, the US National Hurricane Centre said.
While Bill posed no threat to oil installations in the Gulf of Mexico, authorities in Bermuda warned residents to be prepared.
Energy markets watch storms in the Gulf of Mexico closely because the region produces a quarter of US oil and 15 per cent of its natural gas.
With winds extending outward 72 km, Bill was expected to push well past the Leeward Islands late today and early tomorrow but hurricane center officials still urged islanders to be on the alert.
At 5.00am EST (9.00am Irish time), Bill's centre was about 740km east of the Leeward Islands and moving west-northwest at 26 kmh.
Hurricanes of Category 3 or higher on the five-step Saffir-Simpson intensity scale are considered "major" and are the most destructive type.
Hurricane expert Jeff Masters, founder of the Weather Underground website, said he expected Hurricane Bill to move between Bermuda and the US east coast towards Canada.
"I think the likely main impact (on the US coast) is going to be beach erosion and coastal waves," he said. "Direct impacts are unlikely."
Bill will encounter energy-sapping cool water when it reaches North Carolina but could still be a Category 1 hurricane near Nova Scotia and Newfoundland, Mr Masters said.
Reuters