(Bloomberg) — Alberta is projecting a wider deficit for the current fiscal year as oil prices fall, denting a key source of revenue for Canada’s top energy-producing province.
The deficit will widen to US$4.7 billion (C$6.5 billion) in the fiscal year ending in March, C$1.3 billion bigger than previously forecast, the provincial government said Thursday. Driving the wider shortfall is a C$1.4 billion drop in non-renewable resource revenue compared with original projections.
Alberta’s oil sands account for most of the crude output in Canada, the world’s fourth-largest producer. Non-renewable resource revenues, including oil and gas royalties, are second only to taxes as the biggest source of funds for the province. Alberta is projecting benchmark oil prices will average $63.75 a barrel this year, $4.25 lower than budgeted, as U.S. tariffs weigh on global energy demand and OPEC+ nations boost output.
Taxpayer-supported debt in the province will drop to C$84.3 billion by March 31, down about C$900 million from a year earlier, as pre-funded debt maturities are paid off. Net debt to GDP at year-end is forecast to be 8.7%.
