SHANGHAI (Reuters) -CNOOC Ltd shares surged as much as 44% in their Shanghai debut on Thursday, defying broad market weakness, as investors sought safety in the Chinese oil giant amid high energy prices and quickening inflation.

After opening 20% higher, CNOOC shares immediately shot up 44% on the Shanghai Stock Exchange, hitting a price ceiling for the day and triggering a 30-minute trading halt. The stock ended the session up 27.7%.

It marked a bright spot in a bleak Shanghai market that slumped more than 2% amid COVID-19 lockdowns and geopolitical tensions.

"CNOOC is being chased by investors who are seeking shelter in big caps with relatively low valuation and high dividends," said Linus Yip, chief strategist at First Shanghai Group. "The stock also whets market appetite at a time when oil prices are climbing and inflation accelerating."

China's largest offshore oil producer raised 28.08 billion yuan ($4.41 billion) in the country's 11th-biggest public stock offering. It said it would use the proceeds to fund one gas and seven oilfield projects in China and overseas, and to replenish capital.

The Shanghai listing "is a key milestone in the company's history," CNOOC Chairman Wang Dongjin said in a statement.

CNOOC will fully exploit financing channels both home and abroad, to promote quality growth, and create value for shareholders, he added.

Chen Shuxian, an analyst at Cinda Securities, said in a note on Thursday that "CNOOC represents historic investment opportunities, thanks to high oil prices, low valuation, and consistently high dividend yields," adding the company's market cap has potential to double over the next few years.

CNOOC's Hong Kong-listed shares rose as much as 4.3% in early trading, but later swung to a loss of roughly 3%.

BEARISH MARKET

CNOOC starts trading in Shanghai against a backdrop of a downbeat stock market that has witnessed an increasing number of stocks falling below their initial public offering (IPO) prices.

A third of the roughly 100 companies which have listed this year in Shanghai and Shenzhen have fallen below their offer prices on debut, data from East Money Information show. Some, including chipmaker Vanchip Tianjin Technology Co Ltd and electronics firm Rigol Technologies Co Ltd, tumbled more than 30%.

Such debut performance - in sharp contrast with the first-day pop that once featured in China's stock markets - reflects the result of IPO reforms, as well bearish investor sentiment.

China's stock markets are the second worst performers globally this year after sanctions-hit Russia, as the economy grapples with COVID-19 flare-ups, the Ukraine crisis, and U.S. monetary tightening.