LONDON (Bloomberg) — Bermuda-based Frontline Ltd., the world's biggest oil-tanker company by capacity, will probably say first-quarter profit halved after OPEC production cuts and the warmest winter on record eroded ship hire rates.Net income may fall to $100.3 million, or $1.33 cents a share, from $219.1 million, or $2.93 a share, a year earlier, according to the median forecast of 10 analysts surveyed by telephone and e-mail. Frontline was scheduled to report earnings today at 3 a.m. Bermuda time.

"It was a disappointing winter," said Ole Stenhagen, an analyst at SEB Enskilda in Oslo, who has a "reduce" rating on the shares. A vessel glut and swelling crude-oil stockpiles at refineries prevented freight rates from recovering until the end of the quarter, he said.

December to February was the warmest-ever winter period, according to the US National Oceanic and Atmospheric Administration. The conditions lowered refinery demand for tanker-loads of crude oil. Vessel bookings also were curbed by the 1 million-barrel-a-day output cut that members of the Organisation of Petroleum Exporting Countries members began implementing in the prior quarter.

Frontline's biggest ships, so-called very large crude carriers, earned about $44,512 a day in the quarter, according to estimates from Oslo-based investment bank Carnegie ASA. That's 13 percent less than the VLCCs of Antwerp-based Euronav NV, a member of the shipping pool Tankers International LLC, Frontline's biggest competitor. Euronav's net income fell 68 percent in the period.

Shares of Frontline have climbed 37 percent this year, valuing the company at 19 billion kroner ($3.2 billion). Customers include Exxon Mobil Corp., the world's biggest oil company, and Royal Dutch Shell Plc, the No. 2 by sales.

The shipping line's 1 million-barrel tankers, known as suezmaxes, made $35,000 a day, according to Carnegie. That's about the same as vessels operated by New York-based General Maritime Corp., the second-largest US.tanker owner, which earned $35,075 a day for vessels of the same size. Employment of the global supertanker fleet may continue to drop this year. Vessel utilisation will fall to 93 percent, from 96 percent last year, according to London-based shipbrokers Galbraith's Ltd.

OPEC cut production by 1 million barrels a day by February as part of its commitment to trim excess supplies. OPEC is pumping enough crude to satisfy world consumption and has no need to review quotas before its September meeting, group president Mohamed al-Hamli said May 15.

"It looks like OPEC has to raise output for the second half of the year," said Erik Helberg, an analyst at Oslo-based Pareto Securities, which raised its rating to "buy" from "hold" in the past month.

"We anticipated that freight rates would be 25 percent below last year but the way it looks now, you could have the same as 2006 and that's a significant change in our view," he said.

Frontline spun off two units in the quarter. Sealift Ltd., which converts vessels nearing obsolescence into oil-rig transporters, raised $180 million in a January share sale. The following month Sea Production Ltd. raised $180 million. Frontline retained stakes in both companies and said the spin-offs would support earnings.