Alaska editorial: Price swings show danger of relying on oil for budget
This editorial appeared in Saturday's Anchorage Daily News:
A week ago, the front-page headline read: "Oil flirts with $50 price tag." A barrel of oil was starting to look almost as good in 2004 as it did back in the salad days of 1981. Then the markets went back to work.
On Friday afternoon Alaska North Slope crude closed at $40.10 per barrel - a tidy amount, and well above the price needed to balance Alaska state budgets, but no longer flirting with $50. Can anyone spell v-o-l-a-t-i-l-i-t-y?
The only safe prediction in global oil markets these days is change.
Gov. Frank Murkowski drew the prudent lesson from all this during the last legislative session: He campaigned hard for a state fiscal plan to reduce Alaskans' dependence on the whims of the oil markets.
Since legislative campaign season is about to hit high gear, voters should insist that candidates draw their own lessons - and explain them. With prices high, the job will never be easier. Candidates should be debating how, not whether, to put a sound foundation under Alaska's finances. Letting high prices become an excuse for putting off a fiscal plan would be as foolish as betting on that $50 flirt.