The company reported a first-quarter operating profit of $2.8 million (2.1 million pounds), while analysts in a Reuters poll on average had expected a loss of $13.3 million.

Tanker rates are still low, however, and 78 percent of Frontline's very large crude carriers (VLCCs) are covered at a daily $11,600 for the second quarter compared with $14,900 in the first quarter and a cash break-even level of $22,700 for 2018.

"There are encouraging signs that seaborne crude volumes may soon increase as a result of changes by OPEC and a slowing trend of inventory draws," Chief Executive Robert Hvide Macleod said in a statement.

OPEC and Russia last week discussed a potential increase in output by 1 million barrels per day due to rising oil prices after 17 months of production cuts.

"A net 1 million barrels per day in more output from OPEC could lift rates from $15,000 per day to $25,000 on an annualised basis," Clarksons Platou Securities analyst Frode Moerkedal said.

The current pace of scrapping of old tankers could outpace the supply of new vessels and thus lead to a decline in the number of VLCCs globally in 2018, Frontline said.

While the timing of any market rebalancing remains uncertain, Frontline's shares rose 10 percent to a six-month high, outperforming a 0.6 percent gain in the Norwegian benchmark stock index at 1305 GMT.

Frontline expects shipyards to deliver about 40-45 new VLCCs to shipping firms globally in 2018, down from 50 newbuilds in 2017 and 47 in 2016, it said.

So far this year, 13 new VLCCs have been delivered while 22 have been scrapped and additional VLCCs have been sold for near-term scrapping, Frontline said.

Moerkedal maintained a buy recommendation on Frontline following the report. While first-quarter earnings were above his forecasts, guidance for the second quarter was lower, and overall he predicted only minor changes in estimates.

(Reporting by Ole Petter Skonnord, editing by Terje Solsvik and Dale Hudson)