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OMB revises North Dakota revenue outlook downward as oil-price and extraction-tax effects cut receipts
Summary
The Office of Management and Budget told the Joint Appropriations Committee that lower oil-price assumptions and a falling effective oil-extraction tax rate driven by stripper-well exemptions reduce next-biennium revenue projections by about $591 million versus the January forecast.
Joe Morrison of the Office of Management and Budget told the Joint Appropriations Committee the department’s March revenue update lowers the state’s 2025–27 outlook owing mainly to lower assumed oil prices and an adjustment to the effective extraction tax rate as more wells qualify for the stripper-well exemption.
Morrison said North Dakota had collected about $4.65 billion in oil-related taxes through Feb. 28 and that, to reflect recent futures markets, OMB trimmed its oil-price assumptions for the next biennium to about $59 per barrel in the first year and $57 in the second year. Those trimmed price assumptions account for roughly $200 million of a roughly $591 million reduction between the January and March forecasts, Morrison said.
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