Oxford residents evacuated as UK flood waters rise

LONDON, July 25 (Reuters) The River Thames burst its banks today, forcing the evacuation of hundreds of homes in the university city of Oxford in Britain's worst floods for 60 years.

About 350,000 people faced two weeks without running water, the insurance bill could soar to 3 billion pounds (6.2 billion dollars) and farmers say harvests have been badly hit.

Oxford became the new frontline when tributaries of the Thames spilled over into its streets, forcing police to evacuate 250 homes. Residents of historic towns such as Windsor were warned they could be next and more rain is expected.

''There are six severe flood warnings in place. It looks as if we are going to get up to 20 millimetres of rain across the board tomorrow,'' an Environment Agency spokesman said. ''That won't cause devastation but will not help clean-up efforts.'' The insurance bill for floods in June and July could hit 3 billion pounds, insurers say, sparking fears of price hikes.

Homeowners in some of the most flood-prone regions may find it difficult to get insurance in future.

Milk shortages hit some areas with flooded roads making collections from dairy farms impossible. The rain brought harvesting of barley and rapeseed to a halt in many regions.

Potato and salad vegetable crops have been badly damaged and livestock losses have been heavy in some regions with the National Farmers Union reporting more than 1,100 sheep lost in just three farms in central England.

Economists say the floods will trim back economic growth and are likely to trigger a short-term spike in food prices, but the overall economy is likely to weather the storm in the long run.

UTILITIES In Gloucestershire, the western English county worst hit by the deluge, the flood waters started to recede along the River Severn but battered residents braced for more rain.

The government has promised 10 million pounds (21 million dollars) in aid for the stricken areas -- in addition to the 14 million pounds initially pledged by Prime Minister Gordon Brown.

''We are looking at 21st century extreme weather conditions,'' Brown said after a tense day monitoring how emergency services coped with the flooding that deluged huge swathes of central and western England.

Less than a month into the job as Britain's new premier, he said everything had to be looked at from infrastructure and drainage to where utilities were located to combat such conditions.

Asked if the Labour government had done enough over the past decade in office, Brown said investment in flood defences had already been doubled to 600 million pounds before the current crisis ''so we are aware more has got to be done for defences''.

One power distribution station at Walham in Gloucestershire came perilously close to flooding with emergency services working frantically to shore it up as the water came within 6 inches (15 cm) of breaching defences.

That would have left up to 500,000 people without power and plunged hospitals, stores, shops and homes into chaos.

REUTERS SBC VV1743