The bad news for Alberta’s oil-reliant budget is set to get worse.
Finance Minister Nate Horner says softening oil prices mean this year’s projected budget deficit is expected to grow by $1.3 billion, and will now finish at $6.5 billion in the red when the fiscal year ends next spring.
That represents a massive multibillion-dollar swing in Alberta’s financial fortunes, as it is coming off an $8.3-billion surplus the year prior.
The government says uncertainty created by U.S. trade policy is hurting the Alberta economy and remains a significant risk going into the rest of the year.
Oil prices remain the determining factor in Alberta’s budget, as they have for decades.
Every dollar drop in the per-barrel price for the benchmark West Texas Intermediate slashes $750 million from Alberta’s bottom line, and Alberta has lowered its forecast by more than US$4 a barrel since introducing the 2025 budget in February.
The price of West Texas Intermediate dropped to $63.63 per barrel shortly after markets opened on Thursday.
When Alberta’s UCP government released this year’s budget in February, it forecast an oil price of $68. per barrel.
With files from Global News.
