Cheaper Oil Pushes U.S. Trade Deficit to Lowest Level in 18 Months

Low oil prices
By CHRISTOPHER S. RUGABER

WASHINGTON -- The U.S. trade deficit fell to its lowest level in 18 months in June, pushed down by a steep drop in oil imports and a small rise in exports.

The trade gap narrowed to $42.9 billion in June, down from $48 billion in May, the Commerce Department said Thursday. The price of imported oil fell $7.78 to $100.13 a barrel, the steepest drop in 3½ years. That helped lower the trade deficit in oil to its lowest level since November 2010.

Exports rose 0.9 percent to a record high of $185 billion. Overseas sales of autos, pharmaceuticals, and industrial machinery increased. Despite Europe's struggling economy, exports to the 27-nation European Union increased 1.7 percent.

Imports fell 1.5 percent to $227.9 billion, the lowest in four months.

A narrower trade gap acts as less of a drag on growth because it means the United States is spending less on foreign-made products and is taking in more from sales of U.S.-made goods.

The department said late last month that the economy expanded at a 1.5 percent annual rate in the April-June quarter. The department used an estimate of the June trade deficit to calculate that number. The sharp drop in the deficit could mean the economy actually grew at a faster pace. The department will update its estimate of second-quarter growth later this month.

Economists are worried that slower overseas growth will reduce demand for U.S. exports. About one-fifth of U.S. exports go to Europe, which is in the third year of a financial crisis.

So far, that hasn't happened. Exports are up 5.9 percent in the first six months of this year compared to last year.

Higher exports helped cut the trade deficit with the European Union by 20.1 percent to $8.4 billion. The politically-sensitive trade deficit with China worsened, rising 5.2 percent to $27.4 billion.

U.S. sales to China fell, possibly because that country's growth is slowing. Exports to China dropped 4.3 percent to $8.5 billion.

Exports may fade in the coming months. A private trade group said last week that its survey of manufacturers found that export orders fell in July to their lowest level in more than three years.

U.S. growth is too sluggish to support much hiring. Employers have added an average of 150,000 jobs per month this year, about the same as in 2011. That hasn't been enough to lower the unemployment rate, which was 8.3 percent in July.


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democracks0

LMAO Evan is such a dope.

August 12 2012 at 2:23 PM Report abuse +1 rate up rate down Reply
jdykbpl45

Bought gas lately?

August 12 2012 at 11:46 AM Report abuse +1 rate up rate down Reply
1 reply to jdykbpl45's comment
democracks0

Yeah the prices are going through the roof again.

August 12 2012 at 2:24 PM Report abuse rate up rate down Reply
chris1011

Why is Mitt running?
I deferred military service for bicycling in France.
I lived in a 5bedroom house while there, with a chef/ housekeeper and houseboy.
I claimed I lived like poor people then.
I spent the duration of the Vietnam War, proselytizing and converting people to my faith.

At Bain when I became the CEO; I turned the company from venture capital into a corporate raider.
I drove many companies bankrupt after stripping them of their assets and selling them.
I acquired Damon Corps medical labs and while there the company defrauded Medicare to the tune of 100s of millions. When I left the company was bankrupt and 1000 people lost their jobs.
I oversaw the second biggest Medicare fraud in History; just behind my friend Rick Scott’s who is trying to steal Florida for me.
I lay off more than 10’s thousand living, breathing people, solely to line my own pocket.
I enjoy firing people.
Of the companies I didn’t completely bankrupt, I drove 10,000s of people with livable wages into accepting minimum wage and told every single one, if they don’t like it they could leave.
At the same time I gave top management huge pay raises.
I created 10,000s of jobs on foreign shores and people who worked for me there, earned a couple dollars a day, See Global tech. China and Haier Electricals China.
I retired...
I pay 13%; in taxes on unhidden money which until it became illegal in 2011 I hid in tax havens.
I had the third lowest employment rate in any state in America as governor.
While I was governor, I used the Heritage Foundation’s Healthcare plan and created Romneycare’.
It lowered the insurance costs for Massachusetts by 1/3 since introduction.
I was proud when President Obama decided to use the plan, as I thought it would help my chances of becoming President but it was vilified by my party on purely political grounds, so backed away from it.
I cost the state $200000 when I left by replacing all of the states government computers to hide my record.

I think corporations are people but if you look at my history, you’ll find I don’t think people are worth telling the truth.

I have made $1/4billion by destroying thousands of lives.
I don’t care about any of those lives, and as you can see, I have no intentions of being honest with them.
I spent $200.000.000 to beat the weakest and most bizarre field ever in rightwing politics.
Those candidates warned you about me,

August 10 2012 at 10:53 PM Report abuse -1 rate up rate down Reply
democracks0

As you read Evans posts under all his different screen names one being ohmyboentwo, he never ceases in making a fool of himself.

What a dope.

August 10 2012 at 2:42 PM Report abuse -3 rate up rate down Reply
ohmyboehnertwo

barickfarrick
Obama has anti Romney attack adds to make him look good,

Here,........let the weeper of the house give you some tissue, crybaby.

August 10 2012 at 2:20 AM Report abuse +1 rate up rate down Reply
ohmyboehnertwo

barickfarrick:
The oil companies don't need any corporate welfare as you call it. I hate to bust your bubble Snookie


Tuesday evening Republicans in the U.S. Senate succeeded in their mission to block Democratic attempts to remove $21 billion in subsidies which the five largest oil companies presently receive from U.S taxpayers.

By blocking this legislation, the Republicans once again have increased the deficit and in turn they have increased the national debt.

The cloture vote for the Close Big Oil Tax Loopholes Act had 52 yeas and 48 nays. A cloture vote needs a total of 60 votes before moving to the final simple majority vote.

Joining the Republicans in the nay vote against removing the tax loopholes of the oil companies were Democratic Senators Mark Begich of Alaska, Mary Landrieu of Louisiana, and Ben Nelson of Nebraska.

Joining the Democrats in support of the removal of tax loopholes were Republican Senators Susan Collins and Olympia Snowe, both from Maine.

Independent Senators Joe Lieberman of Connecticut and Bernie Sanders of Vermont also voted yea for the removal of the loopholes.

The five oil companies which would have been affected by the bill are BP, ConocoPhillips, Chevron, Exxon Mobil, and Shell, removing $21 billion in tax breaks over a ten year period.

According to The Hill, stating the need to apply the savings to lowering the deficit, Democrats plan to continue to push for the removal of the subsidies as they continue talks with the GOP on the 2012 federal budget and the on the debt ceiling debate.

Senator Majority Leader Harry Reid (D-NV) told reporters after the vote, “I am confident that before we finish our budget negotiations here in anticipation of raising the debt ceiling that that will be part of it.”

Even after oil companies continue to make record profits off of the American people, subsidies to these companies are set to continue indefinitely into the future costing the taxpayers billions of dollars. Despite record profits and billions in subsidies, oil companies continue to overcharge as for gasoline and other products critical to the lives and the economy of Americans and America.

..

August 10 2012 at 1:34 AM Report abuse +1 rate up rate down Reply
johnskii

This is the most stupid article I have read. Ok oil imports have dropped then why are gas prices rising? We have plenty of oil. Now the "PROBLEM" is at the refining level and Iran concerns (HA...Ha...Ha...) Basically it is just *scREW* the average American middle class, working , tax paying, Democrat, Independent, Republican citizen. When are people going to catch on?? ???????

August 09 2012 at 9:19 PM Report abuse +1 rate up rate down Reply
rjen164497

What credibility does aol business have with this story?

August 09 2012 at 2:19 PM Report abuse rate up rate down Reply
esthermarohl

Republicans do not want the price of gas to go down. They are afraid it will make Obama look good.

August 09 2012 at 1:59 PM Report abuse +2 rate up rate down Reply
1 reply to esthermarohl's comment
dsmart51

Obama does'nt have a clue and would not know how to control oil prices if he could. The only thing that could make him look good is if he resigned.

August 09 2012 at 3:02 PM Report abuse +3 rate up rate down Reply
1 reply to dsmart51's comment
ohmyboehnertwo

The republicans don't have a clue in what their doing. Thats why they picked Mitt Robbery.

August 10 2012 at 2:24 AM Report abuse +1 rate up rate down
dennisandco

So why is our gas not cheaper for us than ?

August 09 2012 at 1:20 PM Report abuse rate up rate down Reply