WASHINGTON — America's trade deficit showed a slight improvement in March as sales of American products overseas outpaced an increase in imports, which were driven higher by the biggest one-month jump in crude oil prices in nearly 12 years.

        The Commerce Department reported Friday that the March deficit narrowed to $31.6 billion. That was a 0.4 percent improvement over the February trade gap of $31.8 billion, which had been the biggest imbalance in 10 months.

        The strength came in a 0.6 percent rise in exports of goods and services, led by gains in foreign demand for commercial aircraft, American-made autos, and auto parts and computers.

        That offset a 0.3 percent rise in imports, led by a 15.7 percent jump in America's foreign oil bill, which rose to $6.83 billion.

        That figure reflected a $2.62 increase in one month in the average price of a barrel of foreign crude oil, to $19.18. The jump was the biggest since a $4.45-per-barrel surge in October 1990 after Iraq's Saddam Hussein had invaded Kuwait.

        For all of 2001, America's trade deficit shrank by 7.5 percent to $347.5 billion, down from an all-time high of $375.7 billion in 2000.

        In the first three months of this year, the deficit was running at an annual rate of $367 billion, which would represent an increase from last year. Many analysts are predicting a rise in the trade gap this year because they expect the U.S. recovery from last year's recession will outpace economic growth in the rest of the world, meaning higher demand in this country for imports compared with more sluggish overseas demand for U.S. exports.

        American manufacturers also see another culprit for the huge trade imbalance — a U.S. dollar they believe is overvalued by up to 30 percent. That makes their goods more expensive in foreign markets and exposes them to competition in the United States from cheaper-priced foreign products. They say the high-flying dollar has cost a half-million manufacturing jobs over the past two years.

        However, private economists say the strong dollar has given the United States many benefits, including lower inflation and the ability to attract foreign investments.

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