New oil boosts UK trade

The UK’s balance of trade has fallen over the course of July against analyst predictions, after an increase in oil exports from the North Sea.

The fall over the course of last month takes the UK’s gap between its total imports and total exports to its lowest level in over two years, thanks to increasing outwards trade in oil.

The increase in oil trade is thought to be attributable to the introduction of a new, fully functional oil field in the North Sea, as well as a global increase in demand for crude oil, and higher oil prices measured per barrel.

The trade deficit through June reached just £3.6 billion, down from £3.7 billion in May, taking the gap to its lowest level in over two years, thanks to steadily increasing volumes and value of oil exports.

The deficit in goods exclusively fell to just £6.3 billion from £6.4 billion through May, reflecting a drop in goods imports from abroad and an increase in manufacturing output.

Manufacturing output and UK employment productivity over the course of June has also performed well, bearing heavily on the overall balance of trade against consistent surpluses in the services sector.

The international UK surplus in services remained constant through June at £2.7 billion, offsetting much of the deficit from elsewhere in the market to achieve this improved figure.

The figures represent the first time since early 2005 that the UK has produced an exported more oil than it has imported, at a time where oil prices have escalated to the near $80 barrel mark, making for the positive results in the trade gap.

Conversely, the deficit in the US has continued to rise off the back of growing oil imports and production outages at refineries on the continent.

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