Alberta expects $2B surplus instead of $9.4B deficit, due to Iran war bump to oil prices

Jason Markusoff · CBC News

· Posted: Aug 27, 2026 1:13 PM EDT | Last Updated: 6 minutes ago

The U.S.-Iran conflict's impact on oil prices has taken Alberta's budget picture skyward with them, turning a previously forecast $9.4-billion deficit into a $2-billion surplus.

The same geopolitical factor that has caused massive inflation to fuel prices has also been, as economists predicted, a massive boon to the oil-producing provincial government's bottom line, Alberta Finance reported Thursday.

In late February, Alberta's finance minister had initially tabled a deficit-mired budget that pegged the benchmark oil price for the 2026-2027 fiscal year at $60.50 US per barrel.

But that budget was released mere days before U.S. and Israel began their attack on Iran, which led to a prolonged squeeze on oil tankers' access to the key Strait of Hormuz shipping route.

In the nearly five months since, oil prices have actually averaged about $88 US per barrel, the province estimates, which will substantially boost the province's energy royalties and tax revenues.

Alberta's revised surplus forecast assumes an ease in conflict and global oil supply squeeze, and for oil prices to decline substantially and average $73.50 US for the April-to-March fiscal year.

If that doesn't happen, and oil prices remain at or near current levels, Alberta could add several billion dollars more to its annual surplus.

Finance Minister Jason Nixon told reporters Thursday the government knows the economic picture could change rapidly once again.

“We cannot mistake a temporary windfall for a permanent trend,” he said at a Calgary news conference.

More to come.