Alberta Finance Minister Joe Ceci says the oil-rich economy is recovering after last year's slump, though it's not yet widespread. Photo by the provincial government of Alberta
June 30 (UPI) -- The economy of oil-rich Alberta has turned the corner following last year's market slump, though recovery is not yet widespread, the government said.
Alberta's economy dipped into recession last year under the dual strains of lower oil prices and spring wildfires that sidelined about 1 million barrels of oil production per day.
In an annual review, the government said the economy bottomed out in the middle of last year. More than 40,000 full-time jobs were added to Alberta's economy between July 2016 and March and the government said the weighted average of nine monthly indicators showed expansion accelerated from May 2016 to March.
"While Alberta's economy returns to growth and jobs continue to come back, we recognize this is not yet felt by all Albertans," Finance Minister Joe Ceci said in a statement.
The province ended the year with an $8.3 billion deficit, nearly 4 percent higher than expected. Revenue, however, was up about $770 million because of higher royalties from oil sands production, though those gains were offset somewhat by lingering weakness in oil prices and lower tax revenue.
Ceci in February said the government was forecasting on the assumption of crude oil prices of $48 per barrel. Most major benchmarks for the price of crude oil are in the mid- to upper-$40 range.
Lower crude oil prices last year had curbed spending on exploration and production, a trend typically indicated by rig counts. In its annual review, the provincial government said rig activity had doubled by the end of last year and recovery was apparent in manufacturing and other non-energy sectors.
"Alberta's economy contracted an estimated 3.5 per cent in 2016, but positive indicators began to appear later in the summer and continued into early 2017," the government's report read.
Outside of Alberta, a review this week from the Canadian Association of Petroleum Producers said oil sands production could bring more than 16,000 jobs to Quebec and $165 million in government revenues.
The Central Bank of Canada reported an inflation rate of around 1.6 percent for April, below its 2 percent target for growth. The nation's economy, which relies in part on exports of fossil fuels, was hit hard by the downturn in crude oil prices last year, though Deputy Gov. Carolyn Wilkins said that phase was in the rear-view mirror.