**scroll down for updates**

Landfall came around 3:30amEDT last night. Latest from Bloomberg here:

Hurricane Rita swept ashore in Louisiana, just east of the Texas border, with sustained winds of 120 miles per hour, pushing a storm surge as high as 20 feet into coastal communities.

Rita’s center struck land at about 2:30 a.m., 5 miles east of Sabine Pass on the state border, Colin McAdie, a meteorologist at the U.S. National Hurricane Center, said in a telephone interview from Miami. The storm was near Port Arthur, Texas, at 4 a.m. local time and was moving northwest at 12 mph (19 kph.)

As many as 3 million people in the two states were ordered to flee the storm’s path, jamming highways out of Houston. While insurance companies may face claims as high as $18 billion, according to storm modeler Eqecat Inc., the oil-refining centers around Houston and Galveston were spared the worst of Rita’s damage. Crude and gasoline prices fell yesterday.

“Anything that’s sticking out of the surface of the earth is going to be hammered by these winds,” Lieutenant Dave Roberts, a meteorologist at the Hurricane Center, said today in a telephone interview. “The major problem is going to be the storm surge. We’re going to see major flooding, pretty close to what we had with Katrina.”

Texas is assessing the damage:

State officials began assessing the damage from Hurricane Rita early today as dawn broke over the storm-tossed areas of the Texas-Louisiana border.

“It’s too early to say Texas totally dodged the bullet,” said Kathy Walt, spokeswoman for Gov. Rick Perry. “We haven’t seen what kind of flooding there might be.”

Hurricane Rita made landfall at 2:30 a.m. at Sabine Pass. The storm is expected to lose strength but stall over East Texas, possibly dumping large amounts of rain that could cause flooding.

Walt said Houston missed the worst of the storm, but “let’s not forget about Beaumont, Port Arthur and Livingston and all the communities in East Texas affected by this storm.”

Walt said state crews from a variety of agencies will emerge from shelters at daylight to start assessing the damage from the storm.

The disaster region suffered mass power cuts. Floods and fires are also widespread.

930am EDT update.Laurence Simon photoblogs in Houston.

More citizen storm watch blogging at Chron.com.

Predictions of a “relief rally.”