Oil Prices Loom Large on Alberta Government 2nd Quarter Update

Alberta government’s second quarter fiscal results show a strong first six months of the 2014-15 fiscal year; however, the on-going decline in oil prices suggests this is likely not to continue into the second half of the year.

The surplus for 2014-15 is now forecast at $933 million, down from $1.1 billion forecast at budget. The revenue forecast has been updated to $45.0 billion, $637 million higher than originally estimated at budget. Total expense is now forecast at $44.1 billion, up $791 million from budget.

The capital plan is providing $7.3 billion for Alberta’s infrastructure, a $673 million increase from budget, primarily for additional school projects.

The revised revenue forecast is based on $75 US per barrel for the remainder of the fiscal year. For the first six months, WTI averaged $100.08 but with the recent decline in energy prices is now forecast to average $88.88 for the fiscal year.

For further numbers and information please see the government press release here.