US Trade Deficit Narrows Slightly in April
The trade deficit in the US showed a small reduction in April, as a remarkable increase in oil exports balanced out a significant rise in imports of artificial intelligence-related infrastructure equipment. Overall, the core trade dynamics remained largely unchanged.
The deficit for goods and services dropped by 1.2%, settling at $55.9 billion, down from a revised $56.6 billion reported for March, according to the Commerce Department’s announcement on Tuesday. Economists had expected the deficit to be around $55.9 billion. Exports were up 2.6%, reaching a record high of $327.1 billion, while imports saw a 2% increase, totaling $383 billion.
A key driver for the exports was oil. Following the onset of the US-supported conflict with Iran in late February, the Strait of Hormuz has been nearly shut, causing oil prices to surge past $100 a barrel. In response, American oil producers ramped up exports to a record $36.7 billion, climbing from $27.6 billion in March. This led to an unprecedented oil trade surplus of $17.7 billion.
On the import front, equipment related to AI continued to rise sharply, pushing capital goods imports to a record $126.9 billion. Specifically, imports in computers increased by $2.2 billion, semiconductors by $1.7 billion, and communication equipment by $1.6 billion, reflecting ongoing robust activity in domestic data center development.
As both exports and imports shifted, the goods trade deficit with China declined by $2.6 billion to $12 billion. Conversely, the deficit with Vietnam grew, continuing a trend of changes in supply chains that has intensified since trade tensions with China heightened during President Trump’s initial term.
Services exports fell by $400 million to $105.8 billion, affected by declines in travel, transportation, and maintenance services. Notably, travel exports have reached their lowest level in over two years. Services imports rose by $1.3 billion to $78 billion, resulting in a services surplus of $27.8 billion.
In April, the inflation-adjusted goods trade deficit decreased by $1.5 billion to $84.3 billion. This report reflects annual revisions of product and service data. The previously reported March deficit was notably adjusted downwards from $60.3 billion to $56.6 billion.
The deficit for the year so far is down 49% compared to the same timeframe in 2025, though this figure is significantly affected by an unprecedented spike in imports early that year as businesses rushed to secure supplies ahead of President Trump’s Emancipation Day tariffs.
