LONDON, Dec 9 - Britain's trade deficit in goods with the rest of the world narrowed by less than expected in October as production problems at an oil refinery boosted imports of petroleum products, official data showed on Tuesday. The Office for National Statistics said the goods trade deficit shrank to 4.4 billion pounds in October from 4.7 billion in the month before. Analysts had predicted a much sharper narrowing to 4.0 billion pounds. But the ONS said that while maintenance work at North Sea oil fields boosting imports in September had ended, there was still a production problem at one refinery, keeping the oil surplus low and keeping the overall deficit high. "There is no great surprise in the numbers and they are still being distorted by oil production problems," said Robyn Barnett, economist at UBS.
"We don't expect the trade position to improve until the early part of next year." The surplus on oil stood at 97 million pounds in October, up from a revised 56 million in the month before but well below the normally very healthy oil surpluses Britain runs as a result of its North Sea fields. The small improvement in the overall trade gap was a result of a turnaround in erratic items such as falls in imports of aircraft and precious stones and rises in exports of aircraft and silver. The deficit with countries outside of the European Union also narrowed by less than expected, falling to 2.3 billion pounds from 2.6 billion in September and compared with expectations of 2.0 billion. The trade gap with EU countries hit a record of 2.126 billion, marginally higher than in September.//