The UK’s trade deficit narrowed in July, led by an increase in oil exports to the European Union.

The deficit in July totalled £1.5bn, compared with £4.3bn in June, the official figures showed.

Exports of goods rose 9% to £25.8bn, while imports shed 2.1% to £32.9bn. For services, exports fell 0.9% to £15.6bn, while imports declined 0.4% to £10bn.

Commerzbank economist Peter Dixon said July’s figures were better than expected.

The Office for National Statistics said that in addition to higher oil sales to Europe, exports were lifted by a rise in the sale of chemicals and consumer goods to non-European Union countries.

Mr Dixon said: “The numbers are better than expected after June was worse than expected. If you look at them on balance, the export figures are back to where they were in May.

“I wouldn’t expect further such small deficits in the future. UK trade will continue to struggle in the face of the problems in the eurozone.”

The UK has been in recession since the last quarter of 2012, with the most recent data showing that the economy contracted by 0.5% in April to June of this year.