The Department of Revenue released of the Fall 2023 Revenue Sources Book, a report that shows where money will be coming from for the State’s budget, including Revenue’s latest forecast for oil price, oil production, and tax revenue.
Unrestricted General Fund revenue, before accounting for the operating transfer from the Permanent Fund Earnings Reserve, is forecast to be $3.0 billion for Fiscal Year 2024 and $2.7 billion for Fiscal Year 2025.
The Permanent Fund is set to transfer $3.5 billion to the General Fund for FY 2024 and $3.7 billion for FY 2025. These amounts include funds available for general government spending and annual payment of dividends to qualifying Alaska residents.
For FY 2024, the total is $6.5 billion. That number will factor into Gov. Mike Dunleavy’s proposed budget, which he is releasing on Thursday.
The Permanent Fund operating transfer remains a large source of funding to the General Fund, contributing 48% of undesignated general funds for FY 2023 and projected to contribute a range of 54% to 62% for each of the next 10 years, the report says.
In FY 2023, the Alaska North Slope oil prices averaged $86.63 per barrel. The Fall revenue forecast incorporates the most current indicators from the financial markets and is based on an annual average ANS oil price. The ANS oil price for FY24 is projected at $82.39 per barrel and $76 for FY 2025. Oil prices are expected to decline beyond FY 2025, stabilizing at $70 per barrel by FY 2033.
In FY 2023, ANS oil production averaged 479,400 barrels per day. ANS oil production is expected to average 470,300 barrels per day for FY 2024 and 463,800 for FY 2025, respectively, before climbing to 633,000 barrels per day by FY 2033.
Since the department’s Spring 2023 Revenue Forecast, released in March 2023, the ANS oil price forecast has increased by $9.39 per barrel for FY 2024 and $6 per barrel for FY 2025.
The ANS oil production forecast decreased by 26,100 barrels per day for FY 2024 and by 34,200 barrels per day for FY 2025. Driven by the revised outlook of oil price and production, the Unrestricted General Fund revenue forecast increased by $228 million for FY 2024 and $79 million for FY 2025.
The Revenue Sources Book is available on DOR’s website at www.tax.alaska.gov.
