Alberta Surplus Swells as Middle East Conflict Drives Oil Prices Higher

Alberta's finances have made a dramatic turnaround, thanks to the surge in oil prices caused by the Middle East conflict. The province's latest fiscal update predicts a $2-billion surplus for the 2026 fiscal year, a stark contrast to the $9.4-billion deficit initially expected.

The increase in energy prices was triggered by the U.S.-Iran conflict, which began after Alberta introduced its February budget and has since led to higher West Texas Intermediate (WTI) oil prices. The province estimates that every dollar increase in the average WTI price adds $680 million to its treasury.

With the current WTI price averaging just above US$88 per barrel, officials are anticipating a significant windfall for Alberta's finances. If the price holds steady until the end of March 2027, it could more than erase the province's projected deficit from 2025-26, which was estimated at $4.1 billion.