Business

Trade gap widens on oil imports

Even though it widened in January, economists predict the trade deficit will be narrower this year.
J Pat Carter/Associated Press
Even though it widened in January, economists predict the trade deficit will be narrower this year.

WASHINGTON — The US trade deficit widened in January, reflecting a big jump in oil imports and a drop in exports.

The Commerce Department said Thursday that the deficit rose to $44.4 billion, an increase of 16.5 percent from December. US exports dropped 1.2 percent to $184.5 billion, reflecting declines in sales to Europe, China, Japan, and Brazil. Imports rose 1.8 percent to $228.9 billion as oil imports surged 12.3 percent.

Even with the wider deficit in January, economists say they think the deficit this year will narrow slightly, in part because of continued gains in US energy exports. A narrower trade gap boosts growth because it means US companies are earning more from overseas sales while US consumers and businesses are spending less on foreign products.

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The deficit for all of 2012 was revised down slightly to $539.5 billion, a drop of 3.6 percent from 2011. The January deficit was running at an annual rate of $533.4 billion.

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US exports had jumped to a near-record high in December, a surge that helped the economy grow slightly in the fourth quarter.

Economists see the trade picture brightening further in 2013, helped in part by an energy production boom in the United States and by stronger growth in some major export markets. That forecast is also based on an assumption that the European debt crisis will continue to stabilize, helping boost exports to that region, and that growth in Asia will rebound.

Associated Press