Crude Oil Drove Trade Deficit Decline

By Jane Callen

The U.S. goods and services trade deficit declined 1.7% to $616.8 billion in 2019, its first annual decrease since 2013, according to new U.S. Census Bureau annual data on the international trade balance.

Some of the primary aspects of trade activity between the United States and its partners over the last year occurred in crude oil, according to the U.S. International Trade in Goods and Services report released this month.

A sharp decline in imports, accompanied by a significant rise in exports, played a notable role in lowering the overall trade deficit.

A sharp decline in imports, accompanied by a significant rise in exports, played a notable role in lowering the overall trade deficit.

Crude oil exports increased 35.5% or $17.1 billion compared to the same period in 2018, while crude oil imports decreased 19.3% or $30.3 billion over the prior year.

The graph below shows the petroleum trade balance from 2018 to 2019.

Crude Oil Exports increased approximately $17.1 billion from 2018 to 2019 with the largest increases to the following countries:

• S. Korea, up $3.5 billion.
• Netherlands, $3.0 billion.
• India, $2.1 billion.
• Thailand, $1.5 billion.

Crude Oil Imports decreased by approximately $30.3 billion from 2018 to 2019, with the largest decreases from the following countries:

• Saudi Arabia, down $10.2 billion.
• Venezuela, $9.0 billion.
• Iraq, $5.0 billion.
• Mexico, $2.1 billion.
• Angola, $1.7 billion.

Other significant changes in trade from 2018 to 2019 occurred in the categories of automobiles, pharmaceuticals, corn, and commercial jets.

In automobiles, there were increases on both sides of the ledger: passenger car imports rose $1.9 billion, while exports rose $4.9 billion; trucks, buses and special purpose vehicle imports rose $4.8 billion, while exports rose $1.6 billion.  

Pharmaceutical trade was also a major mover in 2019, with increases in both exports ($6.3 billion) and imports ($16.0 billion).

One of several surprises in the 2019 annual trade numbers related to corn exports, which dropped sharply.

The U.S. corn harvest took a downturn in 2019 over the previous year. Exports of corn declined 36.5% or $4.9 billion.  This decrease was completely quantity driven as the price increased over last year. Historically, this is the largest year over year decrease ever recorded.

The largest decline in 2019 exports over the prior year occurred in civilian aircraft falling 22% to $44.0 billion, followed by petroleum products that declined 11.9% to $56.4 billion.

Source: Census Bureau | Jane Callen is a senior editor and writer in the Census Bureau’s Communications Directorate.