Low oil prices, rising Loonie causing Sask. budget problems

By Sarah Mills/CJME News Staff
August 14, 2017 - 3:53pm

Low oil prices and a rising Canadian Dollar are causing problems for Saskatchewan’s finances.

As of Monday the price of a barrel of oil was steady at $47.50, well below the $55 forecast in the provincial budget.

The Canadian Dollar is also causing problems as it climbs above the forecasted 74.4 cents projected by the government, in recent weeks breaching the 78-cent mark.

The combination isn’t what Finance Minister Kevin Doherty wants to see.

“If you’ve got oil prices going down and the Canadian dollar going up, that is the worst case scenario for the provincial treasury,” Doherty said.

“If you are five cents off on an annualised basis you are looking in the neighbourhood of $100 million or so affecting the treasury to the negative.”

Doherty said the government will likely adjust their price forecasts when the first quarter report is released at the end of August.

“During the course of the year you adjust your budget accordingly when you realise that is not going to come to fruition, good or bad,” he said.

Doherty is hopeful any loss of revenue on the commodity side will be offset by the changes made in the budget, like the increase and expansion to the provincial sales tax.

The impact of those changes won’t show until the mid-year report, which is set to be released in November.

The deficit currently stands at $1.288 billion.

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