According to the Smith government’s 2026 budget released Thursday, amid weak oil prices, the government will run a staggering $9.4-billion budget deficit this fiscal year following the $4.1-billion deficit forecasted for 2025-26. And the government projects deficits until 2028-29 — despite its “fiscal framework” prohibiting deficits for more than three fiscal years in a row.

First, a bit of context.

HILL: Smith government continues on resource revenue rollercoaster with $9.4 billion budget deficit Back to video

The government flipped from an $8.3-billion budget surplus in 2024-25 to a $4.1-billion budget deficit in 2025-26. This swing in fiscal fortunes corresponded with a drop in oil prices — it’s estimated every $1 drop in oil prices is a $680-million hit to Alberta’s bottom line.

Revenues follow oil prices

Oil prices have fallen from US$74.34 per barrel in 2024-25 to a projected US$60.50 per barrel this........

© Edmonton Sun