Alaska Gov. Mike Dunleavy has signed a $14.4 billion state budget, the sixth-largest in state history, after vetoing about $400 million from a proposal passed by the Alaska Legislature this spring.

With Alaska expecting a multibillion-dollar surge in oil revenue due to high prices caused by the Russian invasion of Ukraine, spending is up by $2.7 billion when compared to the budget passed by the governor and lawmakers last year.

That increase is less than the rise in revenue, and the state is poised to end a decade-long streak of years in which it needed to spend from savings in order to bal...