Frontline Shares Surge
Shares in Norwegian tanker group Frontline rose 6.8 percent on Tuesday despite planned oil output cuts by OPEC, buoyed by strong chartering rates and a presentation of the company in New York. Frontline was trading at 157 Norwegian crowns per share, up from 147 crowns at Monday's close. It hit an all-time high of 170 crowns in November after rallying in 2000 from a January low of 36.9 crowns. The Oslo Bourse was up 1.4 percent at 14.00 GMT. "Frontline has a roadshow in New York and it seems very likely that the company's doing well because of this," an analyst said. Frontline finance director Tom Jebsen confirmed that Frontline was in talks with U.S. investors. Analysts say chartering rates have continued to rise despite an OPEC decision last week to cut a million barrels per day from production. Oil output cuts usually mean lower chartering rates because more tankers are competing for less crude.
"The tanker market is very strong at a time many believed it would weaken," Jebsen told Reuters.
An analyst said that some investors may view tankers as a safe haven after four months of high earnings. And he said that the International Maritime Organization seemed likely next month to pass rules limiting the life of older ships, forcing higher scrapping. But economic problems in the United States and Asia could trigger a correction. - (Reuters)