Statistics Canada released the trade data on Thursday. Canada's trade deficit widened to C$649 million in December from a deficit of C$335 million in November. November's figure was revised up from a deficit of C$644 million. Analysts had expected a trade deficit of C$1.0 billion.
The decline was driven by falling oil prices.
Exports rose 1.5% in December. Exports of energy products declined 10.3%, while shipments of metal and non-metallic mineral products surged 13.1%.
Imports climbed 2.3% in December, the fastest pace since May 2014.