VLCCF – Knightsbridge Tankers Limited Second Quarter 2008 Results

Knightsbridge Tankers Limited (the “Company”) reports net income of $14.2 million and earnings per share of $0.83 for the second quarter of 2008. The average daily time charter equivalents (“TCEs”) earned by the Company’s four VLCCs was $58,700 compared with $55,300 in the preceding quarter. The second quarter earnings reflect the continuing strength in the tanker market and an increase in the profit share on Hampstead and Kensington.

The net decrease in cash and cash equivalents in the quarter was $0.4 million. The Company generated cash from operating activities of $14.9 million, used $2.2 million to repay debt facilities, invested $0.3 million in its newbuilding project and distributed $12.8 million in dividend payments. In August 2008, the Company has an average cash breakeven rate for its vessels of $18,700 per vessel per day compared to $18,400 in August 2007.

For the six months ended June 30, 2008 the Company reports net income of $29.0 million and earnings per share of $1.70. The average daily TCEs for the six months ended June 30, 2008 was $56,900. Net interest expense net of capitalized interest for the period was $0.4 million (2007 comparable six months: $2.8 million) due mainly to the lower net debt level.

On August 13, 2008, the Board declared a dividend of $0.75 per share. The record date for the dividend is August 22, 2008, ex dividend date is August 20, 2008 and the dividend will be paid on or about September 9, 2008.

The average market rate for VLCCs from MEG to Japan in the second quarter was about WS 173 ($ 130,000 per day) compared to about WS 126 ($ 86,000 per day) in the first quarter of 2008. The third quarter started with average TCE rates for modern VLCCs, according to Clarkson, of $153,000 per day while present indications are $60,000 per day.

Bunkers at Fujairah averaged approximately $578/mt in the second quarter with a low of approximately $495/mt and a high of approximately $680/mt. The average bunker price at Fujairah so far in the third quarter is $713/mt, according to Platts, while present quotes are $657/mt.

The International Energy Agency (IEA) reported in August 2008 an average OPEC oil production, including Iraq, of 32.2 million barrels per day during the second quarter of the year, a 0.2 million barrels per day decrease from the first quarter. The next OPEC meeting is scheduled to take place on September 9, 2008.

IEA further estimates that world oil demand averaged 86.1 million barrels per day in the second quarter, a 0.8 percent decrease from the first quarter of 2008. IEA predicts that the average demand for 2008 in total will be 86.9 million barrels per day, or a 0.9 percent growth from 2007, hence showing a continued demand growth.

According to Fearnleys, the VLCC fleet totalled 486 vessels at the end of the second quarter with five deliveries during the quarter. There are 24 additional deliveries expected in 2008. The total order book amounted to 208 vessels at the end of the second quarter, up from 185 vessels after the first quarter of 2008. The current orderbook represents about 43 percent of the VLCC fleet. Seven VLCCs were deleted from the trading fleet whilst 28 VLCCs were ordered during the quarter. The single hull fleet amounted to 117 vessels at the end of the second quarter.

The Company has four VLCCs fixed on timecharters expiring between 2009 and 2012 and thus its exposure to short term market fluctuations is limited.  Two of these time charters also include a profit sharing arrangement.  This contract coverage provides good long term stability and limits financial risk.

On June 4, 2007 the Company purchased two newbuilding contracts, each for a Capesize bulkcarrier of approximately 170,000 deadweight tons.  These vessels are scheduled for delivery in 2009.  Both the new vessels under construction have been fixed on five year time charters from delivery in 2009 at a net rate of $40,000 and $53,000 per day, respectively.  The total investment for the newbuilding contracts is approximately $162 million of which the Company has paid $32.4 million to date. The $32.4 million has been 100 % financed through a bank facility.

The full report is available in the link enclosed and on the Company’s website: http://www.knightsbridgetankers.com/

August 12, 2008

The Board of Directors

Knightsbridge Tankers Limited

Hamilton, Bermuda

Questions should be directed to:

Contacts:

Ola Lorentzon, Chairman, Knightsbridge Tankers Limited

+ 46 703 998886

Bjorn Sjaastad, Chief Executive Officer, Knightsbridge Tankers Limited

+ 47 906 90 130

Inger M. Klemp, Chief Financial Officer, Knightsbridge Tankers Limited

+ 47 23 11 40 76

Matters discussed in this press release may constitute forward-looking statements.  The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business.  Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.

Knightsbridge desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words “believe,” “except,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “plan,” “potential,” “will,” “may,” “should,” “expect” “pending and similar expressions identify forward-looking statements.

The forward-looking statements in this document are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management’s examination of historical operating trends, data contained in our records and other data available from third parties.  Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.

In addition to these important factors, important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including fluctuations in charterhire rates and vessel values, changes in demand in the tanker market, as a result of changes in OPEC’s petroleum production levels and world wide oil consumption and storage, changes in Knightsbridge’s operating expenses, including bunker prices, drydocking and insurance costs, the market for Knightsbridge’s vessels, availability of financing and refinancing, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, and other important factors described from time to time in the reports filed by Knightsbridge with the Securities and Exchange Commission.