The extension through the 2021-22 NHL season is worth an average of $2 million annually, according to the hockey club.
Bear, 23, appeared in 71 games with the Oilers last season. He posted five goals and 16 assists. Bear ranked third among Oilers defencemen in points (21) and time on ice (21:58).
Bear played in four games during the 2020 Stanley Cup Playoffs in the Edmonton hockey bubble.
A native of Regina, Sask., Bear was selected by the Oilers in the fifth round, 124th overall, in the 2015 NHL Draft.
The 5-foot-11, 197-pound blueliner has appeared in 89 career NHL games.
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