U.S. trade deficit widens to record $30.6 billion in June

WASHINGTON -- America's trade deficit widened to a record $30.6 billion in June as U.S. imports of industrial supplies and crude oil increased.

The deficit rose from May's $30.3 billion, which was revised down from the government's previous estimate of $31 billion, the Commerce Department reported Friday.

Total imports of goods and services were up by $4.3 billion to $121.2 billion in June. Exports increased by $4 billion to $90.6 billion.

The increase in June's imports mostly reflected a jump in shipments of crude oil -- which were up $1.6 billion -- automobiles, parts and engines and consumer goods, such as televisions, VCRs, stereos and toys. And imports of capital goods, including computer accessories and semiconductors, were up $0.8 billion.

On the export side, the increase came from stronger demand for capital goods, which jumped $2.1 billion, and industrial supplies, up $0.7 billion.

For the first six months of the year, the trade deficit has averaged $177.6 billion, surpassing the record $116 billion for the same period last year.

Exports rose to $518.7 billion during the first six months of the year from $465 billion in the same period in 1999.

Economists believe the bloated deficits reflect the gap between America's remarkably strong economic performance and slower growth overseas.

But critics say the imbalance reflects a failure of the Clinton administration's trade policies, which they believe have left American workers at the mercy of foreign nations with lower labor costs and lax environmental standards.

The trade deficit is the sole blot on an otherwise vibrant U.S. economy, now in its longest-ever streak of uninterrupted growth.

In June, the amount of crude oil imported into the United States, 300.9 million barrels, was the highest since August 1998, when 300 million barrels were imported. The price of crude oil jumped in June to $26.65 a barrel from $24.16, and is far above the June 1999 level of $14.52 a barrel.

Output limits by oil-producing nations have pushed crude-oil prices up over the last year. But many analysts believe prices will ease in the coming months on the expectation that production will eventually be increased.

The U.S. deficit with oil-producing nations, including Saudi Arabia, jumped from $4.1 billion in May to $4.6 billion in June.