Varcoe : Fastest skater on a slow team Alberta expected to keep growing even as budget deficit looms

edmontonjournal.com · Feb 26, 2026 · Collected from GDELT

Full Article

Skip to Content Subscribe FAQ My Account Manage My Subscriptions News Local News Alberta Politics Health Local Crime True Crime National World Weather Archives Under The Dome Sports Edmonton Oilers Cult of Hockey NHL PWHL Junior Hockey NHL Edmonton Oil Kings Edmonton Elks CFL NFL Local Sports Soccer Golf Baseball Basketball Curling Opinion Columnists Letters Send a Letter to the Editor Malcolm Mayes editorial cartoons Business Local Business Featured Businesses Small Business Real Estate Commercial Real Estate Mortgages Energy Technology Gaming Internet Science Space FP Markets Alberta's Top Employers Arts Local Arts Theatre Music Festivals Books Movies Television TV Listings Celebrity Life Fashion & Beauty Homes First-Time Homebuyers Gardening Diet & Fitness Food Local food reviews Recipes Travel Travel Alberta Travel Canada Travel USA Travel International Cruises Travel Guide Savings Advice Contests National Contests Readers' Choice Special Sections Edmonton Fall Home Show Lives Told Tails Told Shopping Edmonton Journal Store Newsletters Puzzmo Vitality Alberta Work Well Diversions Puzzles New York Times Crossword Comics Horoscopes ePaper Driving Vehicle Research Reviews News Gear Guide Obituaries Browse Notices Place an Obituary Place an In Memoriam Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place an Ad Business Card Directory Celebrations Real Estate Marketplace Pet Posts & Adoptions Working Business Ads This Week's Flyers Manage Print Subscription Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Under The Dome Sports Opinion Business Arts Life Shopping Newsletters Puzzmo ePaper Driving Obituaries Classifieds Manage Print Subscription HomeColumnistsVarcoe: 'Fastest skater on a slow team' — Alberta expected to keep growing even as budget deficit looms'The Alberta economy is actually in a relatively good place ... What's going on? It's really that oil prices are much lower than what was budgeted (last year) and what would be needed to balance the budget'Last updated 3 hours ago You can save this article by registering for free here. Or sign-in if you have an account.Finance Minister Nate Horner. Photo by David Bloom /Postmedia, fileFirst comes the economic talk, because there is plenty of deficit debate lurking around the corner in Alberta.Subscribe now to read the latest news in your city and across Canada.Exclusive articles by David Staples, Keith Gerein and others, Oilers news from Cult of Hockey, Ask EJ Anything features, the Noon News Roundup and Under the Dome newsletters.Unlimited online access to Edmonton Journal and 15 news sites with one account.Edmonton Journal ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Support local journalism.Subscribe now to read the latest news in your city and across Canada.Exclusive articles by David Staples, Keith Gerein and others, Oilers news from Cult of Hockey, Ask EJ Anything features, the Noon News Roundup and Under the Dome newsletters.Unlimited online access to Edmonton Journal and 15 news sites with one account.Edmonton Journal ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Support local journalism.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountorThe province’s economy remains in good shape, projected to outperform the rest of the country, said Alberta’s finance minister.With another budget coming this week that is widely expected by analysts to include a hefty deficit, economic growth is welcome, particularly if it comes with more jobs and a lower unemployment rate.“We expect to lead the country in GDP (growth) again, but the population growth will definitely slow. I wish I had a crystal ball when it came to the price of oil,” Nate Horner said Wednesday in an interview.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Headline News will soon be in your inbox.We encountered an issue signing you up. Please try again“We continue to be the fastest skater on a slow team across this country.”On Thursday, Horner will release the provincial budget for the 2026-27 fiscal year, one that economists anticipate will come with more red ink as the price of oil remains well below the US$74 a barrel level that Premier Danielle Smith has said is needed to balance the books.In a report this week, Servus Credit Union chief economist Charles St-Arnaud forecast the province could be staring at a $9.8-billion deficit, if benchmark U.S. oil prices remain around US$60 a barrel for the new budget year, which starts April 1.“That’s quite a big deficit to have in a moment where actually the economy is not in a recession,” St-Arnaud said Wednesday.“The Alberta economy is actually in a relatively good place . . . What’s going on? It’s really that oil prices are much lower than what was budgeted (last year) and what would be needed to balance the budget.”Entering this year, U.S. West Texas Intermediate (WTI) crude was plodding around $57 a barrel, but with geopolitical turmoil in Iran in recent weeks, it moved higher, closing Wednesday at $65.42 a barrel.That’s important for the province’s bottom line, as every $1 change in the price of WTI crude over the course of the budget year — according to last February’s budget — alters provincial revenues to the tune of $750 million. Charles St-Arnaud, chief economist at Alberta Central, poses in the company’s Calgary office on Friday, April 26, 2024. Jim Wells/PostmediaA day before his new budget comes out, Horner was keeping details of the fiscal blueprint under wraps, but discussed the state of the economy. He pointed to a number of issues that drove GDP growth last year, including red-hot housing construction and record oil production.In January, Alberta created 20,000 jobs, and the unemployment rate fell to 6.4 per cent, just below the national average. And 86,000 more people were working in the province last month than the same month in 2025.“We created (almost) 25 per cent of the jobs across Canada for a population of 12 per cent,” Horner said.“We’re also expecting, partly due to a slowdown in population growth and high participation in the labour market, that we will see the unemployment rate come down.”However, there is plenty of volatility on the horizon, from fickle commodity markets to the review of the Canada-United States-Mexico trade agreement this summer.Last month, BMO Economics forecast Alberta’s economy will lead all provinces in GDP growth this year and next, increasing by 2.3 per cent in 2026 and 2.5 per cent the following year.In its second-quarter fiscal update released in November, the government forecast a $6.4-billion deficit for the 2025-26 fiscal year, which ends March 31. At that time, the government lowered its oil price forecast for the current budget year to $61.50 a barrel, down from last February’s $68 projection.The forecast price differential between benchmark WTI crude and Western Canadian Select heavy oil was also narrowed. Every $1-a-barrel drop in the discount over a full year generates an additional $740 million in revenues, according to last year’s budget.“Danielle Smith is dealing with royalty revenues that are five times what (former NDP premier) Rachel Notley had . . . the highest oil production there’s ever been, and they can’t balance the budget,” Alberta NDP Leader Naheed Nenshi told reporters at the legislature on Wednesday. Alberta NDP Leader Naheed Nenshi speaks at a press conference in Calgary on Monday, Feb. 2, 2026. Brent Calver/PostmediaOn the trade front, Alberta is facing the lowest effective U.S. tariff rate among provinces — around three per cent — as most of its oil and gas exports are exempt under CUSMA, but Horner said the upcoming review “is a major risk.”One number that will be closely watched is the province’s new oil price forecast. The finance department usually consults with a number of forecasters and experts before it makes its own call.“The one thing we’ve seen is just (with) the industry forecasters, the range is so wide,” Horner added. “We’ll try to land in a reasonable mid-ground.”The new fiscal plan comes as British Columbia released its own budget last week projecting a record $13.3-billion deficit. Nova Scotia’s budget, unveiled earlier this week, contained a $1.19-billion in red ink.What does seem likely is this will be the second steep deficit in a row for the UCP government. The province’s fiscal framework requires Alberta to return to a balanced budget within three years of posting a deficit.And credit rating agencies will be analyzing this week’s budget to see how the province handles the expected revenue volatility. A pumpjack north of Calgary on Monday, Sept. 9, 2024. Brent Calver/Postmedia“One of the things I’m watching is what is the assumption around oil or energy prices,” said Adam Hardi, a vice-president with Moody’s Ratings.“And perhaps more importantly, whether the province continues to rely on a windfall, essentially from oil revenues, or is there a more credible long-term plan to wean off that reliance.”Hardi pointed out Alberta’s debt burden is lower than other p