CANCUN, Mexico (Reuters) - Mexico's Caribbean beach resorts escaped almost unscathed on Monday from Hurricane Emily, which blew down trees and cut power but nothing more serious.

Cozumel island, a popular diving destination, took the hardest hit. The storm uprooted trees and smashed windows of homes and businesses.

"The danger has passed ... the worst is over," said Felix Gonzalez, the governor of Quintana Roo state, home to Mexico's Caribbean resorts.

Mexico shut down the majority of the offshore wells in its most productive oil fields in the Gulf of Mexico, and two major ports that export crude remained closed early on Monday.

Tourists and residents of the "Maya Riviera" escaped the storm's fury by spending an uncomfortable night crammed into crowded shelters.

Emily killed four people in Jamaica before it hit Mexico, where it was indirectly responsible for three deaths over the weekend.

At first light on Monday morning, cars picked their way through branches strewn across the road in Cancun, the main resort on a long strip of coastline of white sands, turquoise seas and lively nightlife.

There was no immediate sign of serious structural damage.

"I have lived through three hurricanes, and I was expecting lot more entertainment," said Andre Elwes, 29, a Canadian who runs a tourist submarine in Cozumel, home to some of the world's best scuba diving.

The storm, at one point a Category 4 hurricane with winds of 135 mph (215 kph), had dropped to a Category 2 storm on Monday. Emily was crossing the low-lying Yucatan Peninsula and was due to enter the Gulf of Mexico and regain strength later on Monday. It was expected to threaten the southern Texas coast mid-week.

STILL DANGEROUS

The government warned residents of the state of Yucatan to be alert. "We have been asking them not to go out into the street because this storm is still very dangerous," said Carmen Segura Rangel, the head of Mexico's civil protection agency.

At 11 a.m. EDT, the hurricane's center was over the Yucatan peninsula, just northeast of the pretty colonial city of Merida. Its winds had dropped to 100 mph (160 kph).

Many locals had feared a repeat of Hurricane Gilbert, which tore up Cancun in 1988, razing homes and killing hundreds.

But storm warning systems and evacuation procedures have improved greatly since then. The civil protection agency said it had shelters capable of holding more than 300,000 people.

Thousands of tourists cut short their vacations and fled for home over the weekend. But many were unable to leave or decided to see it through.

With luxury beachfront hotels boarded up, inland hotels opened up ballrooms and conference rooms to rows and rows of sleeping couples and families. Others squeezed in 15 people per room. Schools and gymnasiums took in an estimated 60,000 people.

Emily killed four people in Jamaica when a car was swept away by flood waters on Sunday.

Mexican officials attributed no deaths to Emily. But two pilots were killed on Saturday when a wind gust blew their helicopter into the Gulf of Mexico during oil rig evacuations. And a German man was killed when he touched a high tension wire while pruning a tree at his home in Playa del Carmen as the storm approached.

State oil company Pemex cut off most oil production in the Campeche Sound, the Gulf of Mexico basin that produces 80 percent of Mexico's crude. Some 15,000 oil rig workers were evacuated. Oil prices at first jumped in response to the supply cut, before turning lower on signs of slowing demand.

• Reuters