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 multi-billion-dollar swing in Alberta’s financial fortunes, as it is coming off an $8.3-billion surplus the year prior.
Horner said oil prices, along with uncertainty created by U.S. trade policy — specifically conflict over tariffs — are hurting the Alberta economy and remain a significant risk.
“We’re experiencing many pressures on the economy that are outside of our control,” Horner told a news conference Thursday.
Horner said, despite the challenges, a radical response to the budget bottom line isn’t the answer.
“We know how important [financial] stability is for Albertans, and we also know it hasn’t been easy,” he said. “Many Albertans are struggling with high grocery bills, utilities and the pressure of mortgage or rent payments.
“We’ll face these challenges together, and that commitment stands, even with a higher deficit.”
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.
Alberta has lowered its forecast by more than USD $4 a barrel since introducing the 2025 budget in February.
Alberta has also added nearly $650 million in expenses related to new agreements with various unions, while negotiations with others are ongoing.
The province has previously projected multi-billion-dollar deficits will remain through to the scheduled 2027 provincial election.
