Rise in oil prices could add $1.2B in state revenue for Alaska, preliminary forecast says

An above-ground section of the Trans-Alaska Pipeline System near the Toolik Lake Research Station in the North Slope Borough. (Photo by Rashah McChesney/Alaska's Energy Desk)
An above-ground section of the Trans-Alaska Pipeline System near the Toolik Lake Research Station in the North Slope Borough. (Photo by Rashah McChesney/Alaska’s Energy Desk)

The recent increase in oil prices could lead to the state government receiving $1.2 billion in revenue more than expected this year.

That’s according to a preliminary revenue forecast released by the state Department of Revenue on Friday. The final forecast will be made in December. 

While the state forecast in March that oil would average $61 per barrel this year, the update forecasts it at $81.31. The current price is $85.50 per barrel. 

The preliminary report also forecasts an increase in daily North Slope oil production of nearly 30,000 barrels this year, compared with the spring forecast. 

But it forecasts a slight decline in production for the rest of the decade, compared with the spring. The state says that’s due to “increased uncertainty for large projects caused by federal litigation and financing issues.”

Andrew Kitchenman

State Government Reporter, Alaska Public Media & KTOO

State government plays an outsized role in the life of Alaskans. As the state continues to go through the painful process of deciding what its priorities are, I bring Alaskans to the scene of a government in transition.

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