Canada's oil-producing province of Alberta on Thursday forecast a budget deficit of C$5.2 billion ($3.5 billion) for the 2025/26 fiscal year if U.S. tariffs are implemented and decrease government revenues and slow economic growth.

Alberta is bracing for a trade war with the United States that, when coupled with sagging energy prices, will usher in years of deficits, according to the provincial budget tabled Thursday, adding to the growing list of provinces preparing for economic turmoil that would accompany tariffs on Canadian goods.

The looming threat of U.S. tariffs along with a potential tax cut are expected to dominate Alberta's budget today.