ND revenue forecast up $1B on oil taxes

Associated Press

An updated revenue forecast unveiled March 16 shows North Dakota’s treasury expects to collect about $1 billion more in oil taxes over the next two-year budget cycle than what lawmakers expected just two months ago.

The forecast from state budget analysts and Moody’s Analytics predicted a nearly 30% increase in oil prices than what the GOP-led Legislature used as a budgetary starting point in January.

The Legislature’s budget consultancy, IHS Markit, was scheduled to present its prediction March 16. Lawmakers hired the Colorado-based firm in 2017 to give the Legislature a second opinion on state revenue forecasts.

Lawmakers will consider both forecasts to set the final numbers March 18 when they begin finishing their work on the state’s 2022-23 spending plan. The Legislature has idled major spending bills until the new economic assumptions are adopted.

Lawmakers assumed oil prices at $40 a barrel when crafting their budgetary starting point in January. The updated forecast assumes oil prices will reach $53.50 in 2022 and $48.75 in 2023. North Dakota crude was fetching about $64 a barrel March 16.

Analysts expect oil production to remain flat at 1.1 million barrels daily for the next two-year budget cycle.

- Associated Press