LONDON (Bloomberg) — Bermuda-based Golden Ocean Group Ltd., a commodity shipping line led by Norwegian billionaire John Fredriksen, dropped to a five-month low in Oslo trading after ship rental rates plunged and the company sold vessels.

The shares dropped as much as 1.85 Norwegian kroner, or 7.3 percent, to 23.5 kroner and closed down 2.17 percent at 24.80 kroner as in Oslo.

"You might think that they have been betting on declining rates" for hauling iron ore, coal and other commodities by sea, Tore Fugelsnes, an analyst at Nordea Markets Equity Research in Oslo, said by telephone yesterday. "They have been selling vessels and fixing on long-term charters during the last months."

Ship rental rates as measured by the London-based Baltic Exchange dropped the most since 1989 on January 11 amid signs that Chinese steelmakers stockpiled iron ore late last year so they can "soften" demand during negotiations over 2008 contract prices, Fugelsnes said.

Golden Ocean, which has fallen 28 percent this year in Oslo, said yesterday it plans to buy back as much as 10 percent of its outstanding stock. The company purchased 2.5 million shares at 25.75 kroner each, it said.