Skip to main content

Plunging oil prices blow a $4B hole in North Dakota's state budget

  • Author:
  • Updated:
    Original:

The plunge in oil prices has blown a $4 billion hole in North Dakota's budget in the space of just a month.

Lawmakers have accepted a revised forecast that projects the state will collect $4 billion less in oil and gas tax revenue between 2015 and 2017 compared to a forecast in December, the Fargo Forum reports.

According to the Wall Street Journal, the price of a barrel of oil dropped below $44 in same-day trading for the first time since 2009 Thursday, and these plummeting prices are taking a toll on rigs in the Bakken oil patch.

The Fargo Forum says the assumptions were based on discussions with the state tax department and oil and gas industry officials. The new forecast projects tax revenues will be down $4.05 billion in the 2015 to 2017 cycle.

The new figures reflect the lower oil prices and anticipate that a number of oil rigs will suspend operations, the Star Tribune reports.

The report assumes there will be 53 fewer oil wells in production each month, 135 compared to 188 operating last year, and total oil royalties lost, which include income taxes collected from workers, will total $4.9 billion.

Gov. Jack Dalrymple's budget plan in December was based on a price of between $74 and $82 a barrel between 2015 and 2017, the Washington Times reports. The new forecast is based on prices of between $45 and $65 a barrel.

A final revenue forecast will be presented in mid-March. That will be used to formulate the 2015-2017 state budget.

Senate Majority Leader Rich Wardner told the Washington Times the state’s economy remains healthy and oil production is forecast to remain steady despite sagging prices.

Next Up

Screen Shot 2022-05-21 at 5.46.37 PM

Video shows officers ended pursuit before fatal crash in Anoka

The crash occurred when the driver fled police during an attempted traffic stop in Coon Rapids.

Eli Hart

6-year-old Eli Hart identified as boy found dead in car trunk

The kindergartner's father was trying to get full custody of his son.

IMG_3509

Boy found dead in trunk of car in Mound was kindergartner

"It is horrifying and difficult to process a tragedy of this magnitude, especially in our close-knit community," the superintendent wrote.

Minneapolis police

Man found yelling for help after being shot in Minneapolis

The shooting occurred on the 800 block of Elwood Avenue North at around 9:15 p.m.

Screen Shot 2022-05-21 at 9.56.21 AM

Minneapolis North principal says she was fired, district says otherwise

“MPS requires schools to follow protocols in times like that and I did not,” Friestleben said.

Kris Richard Severin

Inmate who escaped Minnesota prison is captured

The inmate escaped Wednesday morning.

Brave New Comedy Workshop in downtown Minneapolis.

Brave New Workshop cancels shows due to COVID-19 cases

The shows were scheduled for Friday and Saturday at the Brave New Workshop Comedy Theatre.

Austin Retterath

Body of missing U of M student found in Mississippi River

Austin Retterath was last seen alive in the morning hours of May 8.

"Love" mural seen in St. Paul.

Summer mural events to bring together community, shine light on MN artists

The 2022 Chroma Zone Mural & Art Festival will take place this weekend in St. Paul's Creative Enterprise Zone, with ensuing events happening this summer.

14869-Manitou-Road-NE-Prior-Lake-MN-55372-6110268-image37

Gallery: Remodeled lakeside home in Prior Lake on market for $2.8M

It offers privacy at the end of a dead-end road fronting onto Lower Prior Lake.

golden valley police department

Carjacking outside ice arena in Golden Valley under investigation

Golden Valley PD confirmed it received a report of a carjacking Monday evening.

Related