Saskatchewan Projects $825 Million Deficit Despite Oil Revenue Boost

The Government of Saskatchewan projects an $825.2 million deficit for the 2026-27 fiscal year, a $6 million increase over March projections. Finance Minister Jim Reiter reported that while the province saw a $331 million revenue boost driven by oil prices reaching US$75 a barrel—spurred by the closure of the Strait of Hormuz and conflict involving the United States, Israel, and Iran—these gains were offset by a $337 million increase in expenses.

Primary cost drivers include $200 million in additional healthcare spending due to inflation and service demands, alongside flood recovery and crop insurance claims following a wet spring. Additionally, lower net income from SaskPower contributed to a $65 million increase in provincial debt. Despite these pressures, the province expects its net debt-to-GDP ratio to improve to 14.9 percent by March 2027, with exports exceeding $24 billion in the first half of 2026.

Opposition NDP finance critic Trent Wotherspoon labeled the report as damning and beyond disappointing, arguing the government lacks fiscal credibility by growing the deficit despite international oil windfalls. Wotherspoon urged the suspension of the 15-cent-per-litre fuel tax to provide cost-of-living relief, a proposal the government rejected, stating such revenues are essential for highway infrastructure. Reiter noted that while the economy remains resilient, the province faces ongoing risks from volatile commodity markets and tariffs imposed by the Trump administration on forestry, steel, and equipment manufacturing.