Crude oil prices pared gains in early Asia trade Monday as traders took profit after a strong rally last week on signs that the global oil glut might start to ease in the coming months. On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at $43.09 a barrel at 0151 GMT, down $0.64 in the Globex electronic session. June Brent crude on London's ICE Futures exchange fell $0.54 to $44.57 a barrel. In the absence of a production-freeze deal between Russia and the Organization of the Petroleum Exporting Countries, oil prices still rose by nearly 5% last week, underpinned by hopes that declining production in non-OPEC countries would help moderate the surplus in the market. The International Energy Agency expects waning output from the U.S., China, Russia, Mexico, and Colombia to reset the supply-and-demand balance next year and that prices will gradually pick up in 2018. Analysts at Bernstein Research paint a more optimistic picture, estimating a rebalance by the second half of this year as prolonged low prices stimulate more demand. "As inventories start to drop, this should push prices towards the marginal cost of production," said Neil Beveridge, senior analyst at the firm. The firm believes a $60-a-barrel oil price is required to balance the market over the longer term. On the demand side, China's slowing economy and the rise of renewable energy pose headwinds, but demand growth for oil is still expected. The IEA forecasts global oil-demand growth to moderate to around 1.2 million barrels a day in 2016, slower than the 1.8 million-barrels-a-day expansion last year. This week, traders will be eyeing the Federal Reserve policy meeting on Wednesday for an outlook on the U.S. economy. The market largely expects the committee to keep the benchmark rate unchanged. The Energy Information Administration will also release weekly U.S. crude inventories and production data for the week ended April 22 on Wednesday. Nymex reformulated gasoline blendstock for May--the benchmark gasoline contract--fell 119 points to $1.5190 a gallon, while May diesel traded at $1.2991, 98 points lower. ICE gasoil for May changed hands at $389.00 a metric ton, down $6.75 from Friday's settlement.
