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As Wall Street tumbles, so too does the price of Alaska crude oil. Just weeks ago it was well over $130 a barrel, but now it is about half that.
"I don't think we anticipated dropping this far this quickly," said House Finance Committee Co-Chairman Kevin Meyer.
He said, the budget made last session anticipated the price of a barrel of oil going for at least $83. Now it is below that, sitting at $67 a barrel.
Since the price has dropped will Alaska be heading for a deficit?
"We're
Meyer says money from the state's surplus has been stashed away in a rainy day fund.
"We saved as a surplus a little over $6 billion."
If need be that fund will be dipped into, but State Revenue Commissioner Patrick Galvin said that won't be necessary.
"Yeah, there's no reason to panic," he said. "The budget is based on the average price and we had a big cushion built up. I think the average price for oil has been well over $100 a barrel."
Galvan said the price would have to drop below $60 per barrel and stay there until June of next year before the state
So the state's rainy day fund will stay untouched, for now
Meyer says the markets are so volatile right now that the situation could be totally different tomorrow.
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