Frontline Shares: Biggest Jump Since 1998
Bermuda’s Frontline Ltd., the top global operator of supertankers, headed for its biggest weekly gain since December 1998 yesterday [Nov.10] on signs of stronger demand to charter the largest crude-oil carriers, the Bloomberg financial news service is reporting.
Frontline has jumped 34 percent this week in Oslo trading. The Hamilton, Bermuda-based company’s market value is now estimated at $486 million although the shares are still down 76 percent this year.
Bookings of very large crude carriers to load oil in the Persian Gulf climbed to 137 for this month, according to commodities and freight-derivatives broker Marex Spectron Group. That exceeds the previous high of 129 in April, it said. Charter rates on the industry’s benchmark trade route starting in the gulf are up the most since February this week.
“Chinese refineries are increasing production to avoid the diesel shortage of last year,” Erik Nikolai Stavseth, an analyst at Oslo-based Arctic Securities ASA, told Bloomberg. “US crude stocks are running down, so there is support for building inventories, and there are slightly more ships booked to head west of the Persian Gulf.”
Charter costs on the benchmark voyage from the gulf to Japan are up 18 percent this week, according to the London-based Baltic Exchange, which assesses freight rates on global maritime routes. That would be the largest increase since the week of February 11.
Domiciled in Bermuda in 1997, Frontline has established itself as the world leader in the international seaborne transportation of crude oil.
