US Trade Deficit Drops To Lowest Since January 2010 As Crude Imports Plunge To 1997 Levels

Tyler Durden's picture

Following November's massive trade deficit surge, when the final print of $48.7 billion was far worse than the $41.3 billion expected, it was only (il)logical that the December trade number would reverse this trend to the other extreme, which it did with the December trade balance plunging from a revised $48.6 billion to a tiny $38.5 billion - the lowest deficit since January 2010, and the biggest beat to expectations of $46 billion since February 2009.

The deficit was the result of December exports which were $3.9 billion more than the $182.5 billion in November, and imports some $6.2 billion less than November's total $231.1 billion. Broken down by category, the goods deficit decreased $9.4 billion from November to $56.2 billion, and the services surplus increased $0.7 billion from November to $17.7 billion. A key driver of this move was a spike in Petroleum exports which shrunk the Petroleum product trade gap to the smallest it has been since August 2009 as the US imported the least amount of crude oil since February 1997. Whether this is due to rising domestic production, or just the ongoing collapse in end demand (which is to the US economy as electricity is China's traditional "8%" GDP) remains unclear.

The immediate result of this second consecutive data outlier in a world which as we showed yesterday trade is imploding thus putting all trade data in a very questionable light, is that Q4 GDP will now have to be revised higher due to the bean counters plug of net export data into their GDP calculation. It also means that much of the expected boost to Q1 GDP exports will actually have taken place in December, in turn pushing Q1 GDP forecasts marginally lower.

Specifically, The November to December increase in exports of goods reflected increases in industrial supplies and  materials ($3.8 billion); other goods ($0.3 billion); and foods, feeds, and beverages ($0.1 billion). Decreases occurred in capital goods ($0.4 billion); automotive vehicles, parts, and engines ($0.3 billion); and consumer goods ($0.2 billion). The November to December decrease in imports of goods reflected decreases in industrial supplies and materials ($4.2 billion); automotive vehicles, parts, and engines ($0.9 billion); other goods ($0.6 billion); capital goods ($0.3 billion); and foods, feeds, and beverages ($0.1 billion). Consumer goods were virtually unchanged.

Finally, we leave it up to readers to figure out how China can report a December trade surplus with the US of $18.7 billion, while the US just reported a Chinese trade deficit of $24.5 billion.

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GetZeeGold's picture



Who can afford gas with the new tax hikes? I've got to save up 20K for health care next year. More if I want the really good stuff.


Seriously considering divorce as an option to save money. Sorry sweetheart....I just can't afford you anymore. Didn't think going Galt was going to mean that.

machinegear's picture

So was I. My wife confirmed the other day I alone would have paid 3k less in taxes if we weren't married. I think she might warm up to the idea if we split the difference; she get's an annual $2k "divorce" ring and I get the remainder.

Never One Roach's picture

Who can afford anything? Postal rates increased over 2.3% and international over 6%.  Small businesses are going under at an alarming rate.

Midas's picture

I wish everything was going up only 2.3%.

CPL's picture

Bullish! @ 5% canal tax on the gross oil trade.

PUD's picture

McDonald's global comparable sales fall 1.9% grease usage plunges

youngman's picture

The question is ....are we slowing down or......are we producing more locally????

LawsofPhysics's picture

Bingo.  Moreover, how much has the black market activity increased.  Hell, we sell a number of things at the local farmer's market pretty much tax-free.

You want to see some real rioting, go ahead and watch what happens when/if local governments try and mess with this truly free exchange of goods and services.

It's one thing to do this when the people it affects have no idea where your house and family live and another thing altogether when they do.

insanelysane's picture

In the People's Republic of Massachusetts they have started to crack down on farmer's markets because of the tax issue.  They also shut down a local farm stand because the farm wasn't "large" enough to meet the law.

zuuma's picture

not very surprising...

We're importing less (fracking).

We're using less - our national impoverishment continues.

We're exporting massive amounts of refined products - gas & Diesel - to places like Venezuela, Japan, Mexico.


'cause they are willing to pay more then us.  Also, exporting refined products helps keep the prices high/ rising here at home.


Long Tesoro Petroleum!!!

knukles's picture

Electric cars.
They run on electricity
Just plug em in and good to go
Don't use any fossil fuel at all
They're electric....duh

Blonde, too


alex_g's picture

And you get to pay a crapload for the batteries.  Tesla's batteries add 30k to the price of a car, or over 200k miles for a car that gets 25 mpg.  We get a battery trade deficit instead of an oil trade deficit.  Money out is money out...

NoDebt's picture

"The question is ....are we slowing down or......are we producing more locally????"

Probably both.

jerry685's picture

US production is way up.....and climbing fast....

More drilling rigs working then we have had ...ever

SDRII's picture

Note that the increase in industrial exports was all nonmonetary GOLD.......

monopoly's picture

Oh that is easy Tyler, They just used the old standby that works every time. It is called  Magic! Just wave the wand and you get what you want.

fonzannoon's picture

They keep marching this Jeremy Siegel guy out there and it's important we all know he works at Wharton. One funny tidbit.

A company I used to work for had an arrangement with Wharton. They would give the reps who sold the most insurance the ability to PAY a lot of money to spend a week at some dumbfuck class at Wharton. At the end of ONE WEEK class they all got their "Wharton Certificate" which immediately was blown up and framed and placed on the wall next to the picture their wife strategically took of them shaking the hand of some low level politician.

The best part is the ad they take out in the local paper congratulating themselves on attaining the prestigious "wharton certificate". That clip goes with the letter to their clients letting them know they went to Wharton to make sure they are on the cutting edge of finance. Give these guys about 5 more years and they will stumble onto the etf. Losers....

Whiteshadowmovement's picture

hahahaha, that was laugh out funny I always saw these ads in the back of the economist (not that Im a fan of that Keynesian status-quo rag) and I always wondered- who except maybe a gullible foreigner is dumb enough to fall for this? Now I know. But fonz, dont you want to be able to say you "went to Wharton" (technically true even if for a few days!), its almost as good as dropping the H-bomb

azengrcat's picture

Q4 flight hours down in a big way.

trendybull459's picture

I advise to companies like Delta,Schmelta,AA and others McDonalds to buy oil refinaries at moment when Dow will plunge into 6000,I see the price of oil in 68-73$ sooner rather then later and thoose companies should to buy oil with both hands,because it dosn't matter what production of oil will be the Big Brothers will implement that or that expences leading to price rock back,but for a mean time its some possibility to protect itself,but taking 147$ experience oil price and every one of airways companies buying as no tomorrow i conclude this time will be no different,start to learn russian friends:

ptoemmes's picture

Bloomie has a headlien that says the beat is due to record petroleum exports:

Did the bother to even look at the ptroleum import number?  

I mean it would be one thing if petroleum imports dropped because we used more domestic product.  Not the case.

Bizarro indeed....

j0nx's picture

Demand wayyy down yet the price of gas is almost at record highs. Hmm...Thanks Ben you mofo.

LawsofPhysics's picture

Demand in the U.S., but not the world.  Wake the fuck up.

MeBizarro's picture

Yup yet you see tons of foolish comments about the price of gasoline in the U.S. with this same sentiment.  

GMadScientist's picture

You have to spend the same amount on gas to work 5 4-hour shifts as you do to work 5 8-hour shifts.

Inflexible demand is a motherfucker.

Caracalla's picture

According to CNBC's headline this morning, this drop in the trade deficit means the 4Q GDP number is wrong and will be revised much higher...thus all is well for the U.S. economy and stocks are ready for take-off again!

SDRII's picture
  • The trade deficit narrowed to its smallest point since January 2010 in December. The deficit fell from $48.6 bln in November to $38.5 bln in December. The consensus expected the deficit to decline to $45.4 bln.
  • While the drop in the deficit was much larger than the consensus expected, it was not far off from what the BEA assumed in the fourth quarter advance GDP data. The BEA anticipated that, excluding nonmonetary gold, the trade balance would fall to roughly -$40.0 bln. According to the actual data, the trade deficit excluding gold dropped to $41.0 bln. That means the huge “surprise” in the trade data will not result in an upward revision to fourth quarter GDP and may actually contribute more to the contraction.
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    thismarketisrigged's picture

    dont worry, the criminals have already made sure that google will touch an all time high today ( amazing how quickly it has recovered from that terrible 3rd quarter) and that aapl will prob be above 500 very soon, bc these fucking criminals will just keep inflating these stock prices, and then we have to here on cnbc and all over these fucking talking heads talk about how these companies are doing great when in reality its the fed that is doing great in inflating stock prices.


    lets be patient guys, eventually, dont know when, this will end and we will enjoy it so much more when the market fucking tanks so hard, wall st is panicking, and all those fuckers lose there money, and hopefully go to jail this time.


    fuck u wall st, u fucking thieves, and fuck u china, u bunch of communists fucks.

    John Law Lives's picture

    "Finally, we leave it up to readers to figure out how China can report a December trade surplus with the US of $18.7 billion, while the US just reported a Chinese trade deficit of $24.5 billion."

    The answer is elementary.  Consumers in the US believe that the fake Rolex watches and Mont Blanc pens etc. made in China are AUTHENTIC, so they declare full market value for such items.  The Chinese ascribe the real cost of that junk into their own data.  Therein lies the difference...  ;->


    BTW, I did pick up a few fake Rolex watches and Mont Blanc pens whilst on business travel to China in the previous decade.  Some of my colleagues in the US thought those items were "authentic".  One of the fake Rolex watches came with its own printed "Certificate of Authenticity" that was printed in China.  The ruse continued... until the watches quit working and the pens crapped out... and I threw them into the trash.  ;->

    adr's picture

    You mean like $60 cost iPhones being sold for $600? Those are actually real. Or $12 plastic made in PRC Coach purses being sold for $350, sadly real.

    I'm not allowed in Coach anymore. My wife wanted to go in, I let her. I said, "Honey do you notice something missing in here?" She said, "No." I proceded to say, "The smell of leather, every one of the bags are plastic. By the way every bag in here was made in China for less than $15. You can get a better quality leather purse at Walmart."

    A saleswoman overheard me and wasn't very happy. She said in a very degrading tone, "Sir, I can assure you we sell the finest handbags in the world using the highest quality materials. Our bags are also hand crafted in Europe. I don't very much care for you insinuation with customers present."

    I replied with, "Madame, I don't care for your lack of knowledge of your own product. You do know what vinyl is, and that microfiber is a fancy word for polyester. I actually have a business card from the president of one of the factories in China that makes your bags, I met him at a trade show. The true manufacturing cost of that $350 purse over there is less than $15. Go open it and tell me where it is made."

    I get an answer of, "Hand crafted by skilled artisans from PRC. See hand crafted and PRC must stand for a district in Italy."

    My reply did not go over well with her, "PRC, Peoples Republic of CHINA. By the way in China hand crafted by skilled artisans means sewn by children in a sweatshop. I guess you are selling $350 slave bags. Amazing what a label can do"

    And now I am not allowed in Coach.

    Meat Hammer's picture

    Thank you.  Now I, too, will soon no longer be allowed in Coach.

    poor fella's picture

    My wife bought me a new wallet from Tumi (don't know why, I'm NEVER replacing this thing).

    Took forever to find where it was made (completely hidden). When she took it back, they asked if I didn't like the wallet and maybe there's another one? She had to tell them about her fruit loop husband that doesn't like items made in the PRC (at least she didn't have to say 'sweatshop' ;)   I bet places are starting to hear more of that. It's a step, but Tibet is still doomed and global sweatshops are humming away. I can hear tiny Bangladeshi fingers from here. She should know better, been doing it for decades. Christmas time is real fun.

    Had her get me a 10 dollar bottle of beer instead. 


    adr's picture

    Another WTF moment brought to you by the dumbest smart people in the history of the world.

    Of course, you know what this means. Q4 will be revised to small growth when Q1 comes in negative. LOOK NO RECESSION!!!!!

    I don't think any of the tortuous methods in history are appropriate enough for the banksters today. I think slow impalement on spikes is still to kind. I'm thinking the Law Abiding Citizen way is a good start.

    thismarketisrigged's picture

    btw expect a big day today, because this fucking criminal bastards will do all they can to make sure the major averages have a big enough gain today so they finish positive for the week,


    fuck u wall st

    poor fella's picture

    Markets in Spain up 2%?

    Look how well that's helping their economy. 

    Every sentance from these shitheads should end in "voilà"!

    kito's picture

    gubmmint  NEEDS trade deficits................its the fastest way to spread its dollar infection around the world................a shrinking trade deficit leaves the bernank with a to keep printing if we cant get those dollars absorbed abroad.................a trade surplus might be one scenario that could spark hyperinflation...........

    MeBizarro's picture

    Don't worry about that.  Even with some of the more lucridious energy-related claims, the US is going to remain a large net importer of oil regardless of the relatively minor uptick in oil and natural gas fracking.