Tanker Owner Frontline Says Market Remains Weak; May Sell Ships
Frontline Ltd., the supertanker owner led by Norway-born billionaire John Fredriksen, said a weak market for leasing its ships to oil companies will likely persist and that it may sell vessels.
“The board expects the weak trend in the first-quarter results to be extended into the second quarter,” Frontline said in a statement today. “It is hard to see a recovery in the tanker market” for as long as the supply of ships grows faster than demand.
Returns on very large crude carriers, or VLCCs, that reached $177,036 a day in July 2008 were last at $8,900, according to the London-based Baltic Exchange, which publishes daily rates for more than 50 maritime routes. Frontline, based in Hamilton, Bermuda, needs $29,700 a day to break even on its supertankers, it said today.
Frontline will pay a dividend of 10 cents a share for the first quarter after net profit fell to $15.5 million from $79.7 million a year ago, it said in a statement.