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The UK's overall trade gap unexpectedly widened in July, with a rising oil deficit partially to blame.

New data released by the Office for National Statistics (ONS) showed that the UK's overall deficit on trade in goods and services widened to £4.4 billion in July, compared with an upwardly revised deficit of £3.9 billion in June.

The deficit on trade in goods increased to £7.1 billion, up from £6.5 billion in June. This was a higher shortfall than analysts had anticipated in the value of the country's exports over imports.

According to the ONS, total exports of goods in July rose by 2.5 per cent to £19.2 billion and total imports of goods rose four per cent to £26.3 billion.

The surplus on trade in services with the rest of the world remained steady at £2.6 billion.

Meanwhile the oil deficit widened to £270 million in July, the largest gap since January.

The ONS said that a "duplicated" submission from an oil trader of £300 million had meant that a surplus of £257 million had previously been incorrectly reported for June.

As such the data was changed to show an oil deficit of £14 million for that month.

Some analysts said the growing trade gap suggested that the strong pound was making British goods increasingly unattractive to overseas markets.

Others also warned that ongoing problems in the US sub-prime mortgage market could also dampen demand for imports there.

The world's share markets are currently experiencing a period of volatility as a result of rising default levels in the sub-prime sector, which makes home loans available to those on low incomes or who have a poor credit rating.

It is feared that the problems in the sector could spread to the wider economy if the world's banks become more unwilling to lend to consumers and businesses as a result of losses made due to exposure to bad debts in the specialist housing market.

Global Insight chief economist Howard Archer said: "Exporters will be concerned that the ongoing financial market turmoil could increasingly feed through to significantly dampen global economic activity.

"In particular, prospects for domestic demand in the US are becoming more worrisome," he added.