$59 Billion August Trade Gap Below Expectations

The U.S. trade deficit (search) widened 1.8 percent in August to its third-highest level on record as oil import prices hit a new high and imports of textiles and other goods from China also set a record, the U.S. government said on Thursday.

The August trade gap totaled $59 billion, slightly below a median $59.5 billion estimated by economists before the report. Record imports of $167.2 billion easily overwhelmed record exports of $108.2 billion.

Oil import prices increased for the third consecutive month to a record $52.65 per barrel, lifting imports from OPEC (search) countries to a record $11.9 billion. Overall crude oil imports were $17.2 billion in August, also a record.

The report showed little initial impact from Hurricane Katrina, which forced the temporary closure of the Port of New Orleans (search) after it hit on Aug. 29. The Commerce Department will publish preliminary September trade data on Oct. 21 for Gulf ports.

U.S. imports increased 1.8 percent in August, as U.S. economic growth continued to outpace that of other major developed countries. Key import categories such as industrial supplies and materials, autos and auto parts and capital goods all showed gains.

Imports from China were a record $22.4 billion, aided by a 3.1 percent jump in textile and clothing shipments. Imports of those products rose more than 53 percent in the first eight months of 2005 from the same period a year earlier. This follows the end of global textile quotas on January 1.

U.S. trade officials are in Beijing trying to negotiate an agreement that would stem the flow of clothing imports. The United States ran record trade deficits with China, the European Union, OPEC and South and Central American countries in August.

Meanwhile, U.S. labor, farm and manufacturers groups have set a news conference on Thursday to push for tougher U.S. action to curb the growing trade gap with China.

U.S. exports jumped 1.7 percent in August, aided by a big increase in shipments of civilian aircraft. Other key categories, including autos and auto parts, also had gains.