OTTAWA — Canada's parliamentary budget office says Ottawa will stay in a deficit in the coming fiscal year if battered oil prices stay near their current lows.
The budget office's new analysis says low oil prices have put the government on track to exhaust the federal contingency reserve and run a deficit of $400 million in 2015-16.
Federal Finance Minister Joe Oliver has insisted the Harper government will balance the books, though it may have to dip into the $3 billion reserve set aside for unforeseen circumstances.
The parliamentary budget office says it based the calculation on a scenario where oil prices average US$48 per barrel for all of 2015.
It also crunched numbers on a second scenario, one where oil averages US$51 per barrel for 2015.
The office says those prices would also use up much of the contingency reserve, but leave the government with a surplus of $700 million.
