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Frontline soars 8.5% on Egyptian instability

Shares set fair: The supertanker Sea Force, owned by Bermuda-based Frontline

LONDON (Bloomberg) Bermuda-based oil tanker operator Frontline Ltd rose the most in more than 19 months as OPEC’s crude-oil output reached a two-year high and anti-government protests in Egypt stoked speculation that Suez Canal traffic may be disrupted.Frontline added 12.3 kroner, or 8.5 percent, to 157.50 kroner at the 5.30 p.m. close in Oslo trading on Friday. The advance was the biggest since June 19, 2009. The shares have gained 4.7 percent this year, increasing the company’s market value to 12.3 billion kroner ($2.1 billion). Frontline is the world’s largest operator of supertankers.The Organisation of Petroleum Exporting Countries’ (OPEC) crude-oil output rose to 29.395 million barrels a day on average in January, led by gains in Iraq and Saudi Arabia, a Bloomberg News survey showed. That’s the highest since December 2008.Demonstrations took place across Egypt today, with clashes erupting in central Cairo in the biggest challenge to President Hosni Mubarak’s 30-year rule.“A combined impact of speculation about any impact on transport in the Suez Canal from the unrest in Egypt and news flow about the rising OPEC production has a positive effect on shipping demand,” Petter Narvestad, an analyst at Fondsfinans ASA in Oslo, said by phone on Friday.Prolonged disruption of the canal may force ships to travel around South Africa, potentially boosting hire rates by increasing journey lengths and tying up vessels for longer.Investors bought and sold 2.35 million Frontline shares on Friday, more than triple the daily average for the past six months, data compiled by Bloomberg shows.