Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S–T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

APPLICABLE ONLY TO ~~ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:~~

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. ~~YES~~ ~~☒ NO ☐~~

The number of shares outstanding of the issuer’s Class A common stock, par value $0.01, as of November ~~1, 2022:~~2, 2023: ~~84,518,552~~72,371,476 shares. Excluded from this amount are warrants outstanding as of November ~~1, 2022~~2, 2023 for the purchase of ~~3,619,838~~809,575 shares of Class A common stock for nominal consideration.

	September 30, 2022			December 31, 2021			September 30, 2023			December 31, 2022
	(unaudited)						(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	73,682		$	83,253		$	97,598		$	78,732
Voyage receivables, including unbilled of $6,185 and $3,777, net of reserve for doubtful accounts		22,338			14,586
Investment security to be held to maturity								14,900			—
Voyage receivables, including unbilled of $4,862 and $11,364, net of reserve for credit losses								12,522			19,698
Income tax receivable		1,886			1,882			696			1,914
Other receivables		10,325			5,816			2,227			5,334
Inventories, prepaid expenses and other current assets		4,506			3,438			3,237			2,668
Total Current Assets		112,737			108,975			131,180			108,346
Vessels and other property, less accumulated depreciation		734,204			761,777			679,399			726,179
Deferred drydock expenditures, net		42,135			43,342			41,703			38,976
Total Vessels, Other Property and Deferred Drydock		776,339			805,119			721,102			765,155
Intangible assets, less accumulated amortization		19,167			22,617			14,567			18,017
Operating lease right-of-use assets, net		94,425			152,027			187,135			206,797
Investment security to be held to maturity		14,803			—			—			14,803
Other assets		25,339			26,991			27,188			25,945
Total Assets	$	1,042,810		$	1,115,729		$	1,081,172		$	1,139,063
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable, accrued expenses and other current liabilities	$	46,342		$	49,901		$	49,061		$	54,906
Current portion of operating lease liabilities		80,809			100,010			67,320			63,288
Current portion of finance lease liabilities		4,001			4,000			—			4,000
Current installments of long-term debt		23,346			22,225			43,183			23,733
Total Current Liabilities		154,498			176,136			159,564			145,927
Reserve for uncertain tax positions		184			179			212			175
Noncurrent operating lease liabilities		32,954			73,150			127,266			149,960
Noncurrent finance lease liabilities		17,102			18,998			—			16,456
Long-term debt		405,441			422,515			363,327			399,630
Deferred income taxes, net		65,737			63,744			79,263			70,233
Other liabilities		20,626			22,393			8,893			16,997
Total Liabilities		696,542			777,115			738,525			799,378
Equity:
Common stock - Class A ($0.01 par value; 166,666,666 shares authorized; 88,297,439 and 87,170,463 shares issued; 84,518,552 and 87,170,463 shares outstanding)		883			872
Common stock - Class A ($0.01 par value; 166,666,666 shares authorized; 89,496,512 and 88,297,439 shares issued; 72,322,453 and 78,297,439 shares outstanding)								895			883
Paid-in additional capital		597,117			594,386			587,447			597,455
Accumulated deficit		(243,108	)		(259,587	)		(190,989	)		(233,023	)
Treasury stock, 3,778,887 shares, at cost		(11,026	)		—
Treasury stock, 17,174,059 and 10,000,000 shares, at cost								(57,540	)		(29,040	)
Stockholder’s Equity Subtotal		343,866			335,671			339,813			336,275
Accumulated other comprehensive loss		2,402			2,943
Accumulated other comprehensive income								2,834			3,410
Total Equity		346,268			338,614			342,647			339,685
Total Liabilities and Equity	$	1,042,810		$	1,115,729		$	1,081,172		$	1,139,063

	2022			2021			2022			2021			2023			2022			2023			2022
	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021			2023			2022			2023			2022
Shipping Revenues:

Time and bareboat charter revenues	$	92,730		$	64,535		$	232,934		$	191,130		$	93,224		$	92,730		$	264,621		$	232,934
Voyage charter revenues		30,329			29,432			112,108			72,469			22,211			30,329			71,230			112,108
Total shipping revenues		123,059			93,967			345,042			263,599			115,435			123,059			335,851			345,042
Operating Expenses:
Voyage expenses		7,997			18,602			32,813			51,030			6,858			7,997			22,413			32,813
Vessel expenses		45,430			36,006			130,380			101,815			39,969			45,430			123,337			130,380
Charter hire expenses		22,743			22,806			67,089			67,719			16,233			22,743			47,988			67,089
Depreciation and amortization		17,902			15,526			51,058			45,913			17,003			17,902			49,500			51,058
General and administrative		6,556			5,707			20,929			18,076			7,173			6,556			21,614			20,929
Loss on disposal of vessels and other property, including impairments, net		—			960			—			6,257
Total operating expenses		100,628			99,607			302,269			290,810			87,236			100,628			264,852			302,269
Operating income/(loss)		22,431			(5,640	)		42,773			(27,211	)
Loss on extinguishment of debt, net		—			(7,961	)		—			(7,961	)
Operating income														28,199			22,431			70,999			42,773
Other income, net		568			129			649			140			1,643			568			4,184			649
Income/(loss) before interest expense and income taxes		22,999			(13,472	)		43,422			(35,032	)
Income before interest expense and income taxes														29,842			22,999			75,183			43,422
Interest expense		(8,229	)		(7,052	)		(24,869	)		(20,739	)		(7,779	)		(8,229	)		(24,019	)		(24,869	)
Income/(loss) before income taxes		14,770			(20,524	)		18,553			(55,771	)
Income tax (expense)/benefit		(1,522	)		4,515			(2,074	)		13,195
Net income/(loss)	$	13,248		$	(16,009	)	$	16,479		$	(42,576	)
Income before income taxes														22,063			14,770			51,164			18,553
Income tax expense														(4,471	)		(1,522	)		(9,131	)		(2,074	)
Net income													$	17,592		$	13,248		$	42,033		$	16,479

Weighted Average Number of Common Shares Outstanding:
Basic - Class A		88,174,640			90,808,080			87,579,624			90,513,150			78,263,667			88,174,640			80,544,607			87,579,624
Diluted - Class A		90,349,567			90,808,080			89,211,983			90,513,150			80,700,618			90,349,567			83,233,332			89,211,983
Per Share Amounts:
Basic net income/(loss) - Class A	$	0.15		$	(0.18	)	$	0.19		$	(0.47	)
Diluted net income/(loss) - Class A	$	0.15		$	(0.18	)	$	0.18		$	(0.47	)
Basic net income - Class A													$	0.22		$	0.15		$	0.52		$	0.19
Diluted net income - Class A													$	0.22		$	0.15		$	0.51		$	0.18

	2022			2021			2022			2021			2023			2022			2023			2022
	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021			2023			2022			2023			2022
Net income/(loss)	$	13,248		$	(16,009	)	$	16,479		$	(42,576	)
Other comprehensive (loss)/income, net of tax:
Net income													$	17,592		$	13,248		$	42,033		$	16,479
Other comprehensive loss, net of tax:
Defined benefit pension and other postretirement benefit plans:
Net change in unrecognized prior service costs		(180	)		(181	)		(541	)		(542	)		(181	)		(180	)		(542	)		(541	)
Net change in unrecognized actuarial losses		-			81			-			244			(11	)		—			(34	)		—
Other comprehensive loss		(180	)		(100	)		(541	)		(298	)		(192	)		(180	)		(576	)		(541	)
Comprehensive income/(loss)	$	13,068		$	(16,109	)	$	15,938		$	(42,874	)
Comprehensive income													$	17,400		$	13,068		$	41,457		$	15,938

	2022			2021			2023			2022
	Nine Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2023			2022
Cash Flows from Operating Activities:
Net income/(loss)	$	16,479		$	(42,576	)
Net income							$	42,033		$	16,479
Items included in net income not affecting cash flows:
Depreciation and amortization		51,058			45,913			49,500			51,058
Loss on disposal of vessels and other property, including impairments, net		—			6,257
Amortization of debt discount and other deferred financing costs		840			1,822			855			840
Compensation relating to restricted stock awards and stock option grants		3,237			1,989			2,556			3,237
Deferred income tax expense/(benefit)		1,998			(13,193	)
Deferred income tax expense								9,068			1,998
Interest on finance lease liabilities		1,228			1,362			917			1,228
Non-cash operating lease expense		67,769			68,383			48,970			67,769
Loss on extinguishment of debt, net		—			5,225
Payments for drydocking		(13,896	)		(14,883	)		(12,862	)		(13,896	)
Operating lease liabilities		(69,368	)		(69,297	)		(50,257	)		(69,368	)
Changes in operating assets and liabilities, net		(18,166	)		(11,430	)		(7,730	)		(18,166	)
Net cash provided by/(used in) operating activities		41,179			(20,428	)
Net cash provided by operating activities								83,050			41,179
Cash Flows from Investing Activities:
Expenditures for vessels and vessel improvements		(4,519	)		(5,827	)		(2,593	)		(4,519	)
Purchase of investment security to be held to maturity		(14,794	)		—			—			(14,794	)
Proceeds from disposals of vessels and other property		—			32,128
Net cash (used in)/provided by investing activities		(19,313	)		26,301
Net cash used in investing activities								(2,593	)		(19,313	)
Cash Flows from Financing Activities:
Payments on debt		(16,530	)		(28,919	)		(17,522	)		(16,530	)
Tax withholding on share-based awards		(496	)		(402	)		(1,168	)		(496	)
Payments on principal portion of finance lease liabilities		(3,124	)		(3,124	)		(2,964	)		(3,124	)
Deferred financing costs paid for debt amendments		(261	)		(2,429	)		(53	)		(261	)
Purchases of treasury stock under the stock repurchase program		(11,026	)		—
Extinguishment of debt		—			(274,582	)
Extinguishment of debt costs paid		—			(2,736	)
Issuance of debt, net of issuance and deferred financing costs		—			321,552
Net cash (used in)/provided by financing activities		(31,437	)		9,360
Net (decrease)/increase in cash, cash equivalents and restricted cash		(9,571	)		15,233
Cash, cash equivalents and restricted cash at beginning of period		83,253			69,819
Cash, cash equivalents and restricted cash at end of period	$	73,682		$	85,052
Purchases of treasury stock and Class A warrants								(39,884	)		(11,026	)
Net cash used in financing activities								(61,591	)		(31,437	)
Net increase/(decrease) in cash and cash equivalents								18,866			(9,571	)
Cash and cash equivalents at beginning of period								78,732			83,253
Cash and cash equivalents at end of period							$	97,598		$	73,682

	Common Stock (1)		Paid-in Additional Capital (2)			Accumulated Deficit			Treasury Stock			Accumulated Other Comprehensive (Loss)/Income (3)			Total
Balance at December 31, 2020	$	864	$	592,564		$	(213,335	)	$	—		$	(282	)	$	379,811
Net loss		—		—			(15,868	)		—			—			(15,868	)
Other comprehensive loss		—		—			—			—			(99	)		(99	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net		5		(407	)		—			—			—			(402	)
Compensation related to Class A restricted stock awards		—		575			—			—			—			575
Balance at March 31, 2021		869		592,732			(229,203	)		—			(381	)		364,017
Net loss		—		—			(10,699	)		—			—			(10,699	)
Other comprehensive loss		—		—			—			—			(99	)		(99	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net		2		(3	)		—			—			—			(1	)
Compensation related to Class A restricted stock awards		—		695			—			—			—			695
Balance at June 30, 2021		871		593,424			(239,902	)		—			(480	)		353,913
Net loss		—		—			(16,009	)		—			—			(16,009	)
Other comprehensive loss		—		—			—			—			(100	)		(100	)
Compensation related to Class A restricted stock awards		—		719			—			—			—			719
Balance at September 30, 2021	$	871	$	594,143		$	(255,911	)	$	—		$	(580	)	$	338,523
																		Common Stock (1)		Paid-in Additional Capital (2)			Accumulated Deficit			Treasury Stock			Accumulated Other Comprehensive Income (3)			Total
Balance at December 31, 2021	$	872	$	594,386		$	(259,587	)	$	—		$	2,943		$	338,614		$	872	$	594,386		$	(259,587	)	$	—		$	2,943		$	338,614
Net loss		—		—			(509	)		—			—			(509	)		—		—			(509	)		—			—			(509	)
Other comprehensive loss		—		—			—			—			(180	)		(180	)		—		—			—			—			(180	)		(180	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net		5		(375	)		—			—			—			(370	)		5		(375	)		—			—			—			(370	)
Compensation related to Class A restricted stock awards		—		656			—			—			—			656			—		656			—			—			—			656
Balance at March 31, 2022		877		594,667			(260,096	)		—			2,763			338,211			877		594,667			(260,096	)		—			2,763			338,211
Net income		—		—			3,740			—			—			3,740			—		—			3,740			—			—			3,740
Other comprehensive loss		—		—			—			—			(181	)		(181	)		—		—			—			—			(181	)		(181	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net		3		(3	)		—			—			—			—			3		(3	)		—			—			—			—
Compensation related to Class A restricted stock awards		—		1,735			—			—			—			1,735			—		1,735			—			—			—			1,735
Purchases under the stock repurchase program		—		—			—			(310	)		—			(310	)		—		—			—			(310	)		—			(310	)
Balance at June 30, 2022		880		596,399			(256,356	)		(310	)		2,582			343,195			880		596,399			(256,356	)		(310	)		2,582			343,195
Net income		—		—			13,248			—			—			13,248			—		—			13,248			—			—			13,248
Net income (Loss)		—		—			13,248			—			—			13,248
Other comprehensive loss		—		—			—			—			(180	)		(180	)		—		—			—			—			(180	)		(180	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net		3		(128	)		—			—			—			(125	)		3		(128	)		—			—			—			(125	)
Compensation related to Class A restricted stock awards		—		846			—			—			—			846			—		846			—			—			—			846
Purchases under the stock repurchase program		—		—			—			(10,716	)		—			(10,716	)		—		—			—			(10,716	)		—			(10,716	)
Balance at September 30, 2022	$	883	$	597,117		$	(243,108	)	$	(11,026	)	$	2,402		$	346,268		$	883	$	597,117		$	(243,108	)	$	(11,026	)	$	2,402		$	346,268

Balance at December 31, 2022																		$	883	$	597,455		$	(233,023	)	$	(29,040	)	$	3,410		$	339,685
Net income																			—		—			12,139			—			—			12,139
Other comprehensive loss																			—		—			—			—			(192	)		(192	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net																			8		(1,176	)		—			—			—			(1,168	)
Compensation related to Class A restricted stock awards																			—		800			—			—			—			800
Conversion of Class A warrants to Class A common stock																			1		(1	)		—			—			—			—
Purchases of treasury stock																			—		—			—			(1,862	)		—			(1,862	)
Balance at March 31, 2023																			892		597,078			(220,884	)		(30,902	)		3,218			349,402
Net income																			—		—			12,303			—			—			12,303
Other comprehensive loss																			—		—			—			—			(192	)		(192	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net																			3		(3	)		—			—			—			—
Compensation related to Class A restricted stock awards																			—		862			—			—			—			862
Conversion of Class A warrants to Class A common stock																			—		—			—			—			—			—
Purchases of treasury stock																			—		—			—			(7,985	)		—			(7,985	)
Balance at June 30, 2023																			895		597,937			(208,581	)		(38,887	)		3,026			354,390
Net income																			—		—			17,592			—			—			17,592
Other comprehensive loss																			—		—			—			—			(192	)		(192	)
Forfeitures, cancellations, issuance and vesting of restricted stock awards, net																			—		—			—			—			—			—
Compensation related to Class A restricted stock awards																			—		894			—			—			—			894
Conversion of Class A warrants to Class A common stock																			—		—			—			—			—			—
Purchases of treasury stock																			—		—			—			(18,653	)		—			(18,653	)
Purchase of Class A warrants																			—		(11,384	)		—			—			—			(11,384	)
Balance at September 30, 2023																		$	895	$	587,447		$	(190,989	)	$	(57,540	)	$	2,834		$	342,647

The accompanying unaudited condensed consolidated financial statements include the accounts of Overseas Shipholding Group, Inc., a Delaware corporation (the “Parent Company”), and its wholly owned subsidiaries (collectively, the “Company” or “OSG”, “we”, “us” or “our”). The Company owns and operates a fleet of oceangoing vessels engaged primarily in the transportation of crude oil and refined petroleum products in the U.S. Flag trade.

These financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and notes required by generally accepted accounting principles in the United States (“GAAP”). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of the results have been included. Operating results for the three and nine months ended September 30, ~~2022~~2023 are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2022~~2023 or for any other period.

The condensed consolidated balance sheet as of December 31, ~~2021~~2022 has been derived from the audited financial statements at that date but does not include all of the information and notes required by GAAP for complete financial statements. For further information, refer to the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2021 (“Form~~2022 (the “Form 10-K”).

The Russian invasion of Ukraine has disrupted markets and, in particular, resulted in volatile oil prices and shifting petroleum product flows due to governmental sanctions as well as self-imposed sanctions by oil companies and traders. Our disclosures throughout describe its effects on our business.

The World Health Organization declared the outbreak of a novel coronavirus (“COVID-19”) as a pandemic in March 2020. The COVID-19 pandemic is a dynamic and continuously evolving phenomenon and our disclosures throughout describe its effects on our business.

In November 2019, the ~~FASB~~Financial Accounting Standards Board issued ASU 2019-10, Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815) and Leases (Topic 842): Effective Dates, which allows a two-bucket approach for determining the effective dates of these accounting standards. Under this approach, the buckets would be defined as follows:

Bucket 1— All public business entities (“PBEs”) that are SEC filers (as defined in GAAP), excluding smaller reporting companies (“SRCs”) (as defined by the Securities and Exchange Commission (“SEC”). ~~The credit losses~~This standard became effective January 1, 2020.

Bucket 2— All other entities, including SRCs, other PBEs that are not SEC filers, private companies, not-for-profit organizations, and employee benefit plans. ~~The credit losses~~This standard ~~is to become~~became effective January 1, 2023.

At June 30, 2019, the evaluation date for purposes of determining the applicability of the Bucket 2 credit losses standard, the Company met the SEC definition of a smaller reporting company. ~~Accordingly, the~~The Company ~~plans to adopt the credit losses~~adopted that standard on January 1, 2023. ~~Management does not expect the~~The adoption of ~~this accounting~~the standard todid not have a material impact on the Company’s consolidated financial statements.

The Company has disaggregated revenue from contracts with customers into categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. ~~Consequently, the~~The disaggregation below is based on contract type. Since the terms within these contract types are generally standard in nature, the Company does not believe that further disaggregation would result in increased insight into the economic factors impacting revenue and cash flows.

The following table shows the Company’s shipping revenues disaggregated by nature of the charter arrangement for the three and nine months ended September 30, ~~2022~~2023 and ~~2021:~~2022:

	2022		2021		2022		2021		2023		2022		2023		2022
	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021		2023		2022		2023		2022
Time and bareboat charter revenues	$	92,730	$	64,535	$	232,934	$	191,130	$	93,224	$	92,730	$	264,621	$	232,934
Voyage charter revenues ⁽¹⁾		17,665		17,682		73,036		38,124		8,421		17,665		28,864		73,036
Contracts of affreightment (“COA”) revenues		12,664		11,750		39,072		34,345		13,790		12,664		42,366		39,072
Total shipping revenues	$	123,059	$	93,967	$	345,042	$	263,599	$	115,435	$	123,059	$	335,851	$	345,042

As of September 30, 2023 and December 31, 2022, contract balances from contracts with customers consisted of voyage receivables of $9,317 and $9,258, respectively, net of reserves for credit losses for voyage charters and lightering contracts, which were not material.

~~As of September 30, 2022 and December 31, 2021, contract balances from contracts with customers consisted of voyage receivables of $8,716~~ ~~and $8,227, respectively, net of reserves for doubtful accounts for voyage charters and lightering contracts, which were not material.~~

As of September 30, ~~2022,~~2023, the Company expects to recognize revenue of approximately $~~9,956~~11,779 for the remainder of ~~2022~~2023, $47,578 for 2024 and $~~28,927~~14,608 ~~in 2023~~for 2025 under COAs. These estimated amounts relate to the fixed consideration of contractual minimums within the contracts based on the Company’s estimate of future services.

Basic earnings per common share is computed by dividing earnings by the weighted average number of common shares outstanding during the period. As management deems the exercise price for the Class A warrants of $0.01 per share to be nominal, warrant proceeds are ignored, and the shares issuable upon exercises of Class A ~~warrant exercises~~warrants are included in the calculation of basic weighted average common shares outstanding for all periods.

The computation of diluted earnings per share assumes the issuance of common stock for all potentially dilutive stock options and restricted stock units. Participating securities are defined by ASC 260, Earnings Per Share, as unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents and are included in the computation of earnings per share pursuant to the two-class method.

As of September 30, ~~2022,~~2023, there were ~~3,677,942~~3,180,728 shares of Class A common stock issuable under outstanding restricted stock units and 1,478,756 shares of Class A common stock issuable under outstanding options, both of which are considered to be potentially dilutive securities. As of September 30, ~~2021,~~2022, there were ~~3,380,708~~3,677,942 shares of Class A common stock issuable under outstanding restricted stock units and 1,478,756shares of Class A common stock issuable under outstanding options, both of which are considered to be potentially dilutive securities.

The components of the calculation of basic earnings per share and diluted earnings per share are as follows:

	2022		2021			2022		2021			2023		2022		2023		2022
	Three Months Ended September 30,					Nine Months Ended September 30,					Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021			2022		2021			2023		2022		2023		2022
Net income/(loss)	$	13,248	$	(16,009	)	$	16,479	$	(42,576	)
Net income											$	17,592	$	13,248	$	42,033	$	16,479

Weighted average common shares outstanding:
Class A common stock - basic		88,174,640		90,808,080			87,579,624		90,513,150			78,263,667		88,174,640		80,544,607		87,579,624
Class A common stock - diluted		90,349,567		90,808,080			89,211,983		90,513,150			80,700,618		90,349,567		83,233,332		89,211,983

For the three and nine months ended September 30, 2023, there were dilutive equity awards outstanding covering 2,436,951 and 2,688,725 shares, respectively. Awards of 297,818 and 322,510 shares (related to stock options), respectively, were not included in the computation of diluted earnings per share because inclusion of these awards would be anti-dilutive for the three and nine months ended September 30, 2023. For the three and nine months ended September 30, 2022, there were dilutive equity awards outstanding covering 2,174,927 and 1,632,359 shares, respectively. Awards of 371,893 and 609,956 shares (related to restricted stock units and stock options), respectively, were not included in the computation of diluted earnings per share because inclusion of these awards would be anti-dilutive for the three and nine months ended September 30, ~~2022, respectively. For the three and nine months ended September 30, 2021, awards under which~~ ~~1,842,869~~ ~~shares and~~ ~~2,004,398~~ shares, respectively, may be issued related to restricted stock units and stock options were not included in the computation of diluted earnings per share because inclusion of these awards would be anti-dilutive due to a net loss during the periods.2022.

In July 2022, the Company purchased a $15,000 U.S. Treasury Note for $14,794, with a maturity date of August 15, 2024. The U.S. Treasury Note is classified as investment in security to be held to maturity and is carried at amortized cost on the condensed consolidated balance sheets, as the Company has the intent and ability to hold until maturity.

The amortized cost, gross unrealized loss and fair value of the U.S. Treasury Note at September 30, 2023 and December 31, 2022 iswas as follows:

September 30, 2022	Amortized Cost		Gross Unrealized Loss			Fair Value
September 30, 2023								Amortized Cost		Gross Unrealized Loss			Fair Value
U.S. Treasury Note	$	14,803	$	(316	)	$	14,487	$	14,900	$	(298	)	$	14,602
	$	14,803	$	(316	)	$	14,487	$	14,900	$	(298	)	$	14,602

The Company performed a quarterly review of the U.S. Treasury Note in order to determine whether the decline in fair value below the amortized cost basis was considered other-than-temporary in accordance with applicable guidance. At September 30, ~~2022,~~2023, the Company determined that the unrealized loss on the U.S. Treasury Note was primarily due to increases in interest rates. Therefore, there was no OTTI loss recognized during the three and nine months ended September 30, 2023 or three months ended December 31, 2022.

The following methods and assumptions are used to estimate the fair value of each class of financial instrument:

Cash and cash equivalents and restricted cash— The carrying amounts reported in the condensed consolidated balance sheet for interest-bearing deposits approximate fair value. Investments in trading securities consist of equity securities and were measured using quoted market prices at the reporting date.

U.S. Treasury Note — — The fair value of the U.S. Treasury Note is based on a quoted market price in an active market.

Debt— The fair values of the ~~Company’s~~ publicly traded and non-public debt held by the Company are estimated based on similar instruments.

ASC 820, Fair Value Measurements and Disclosures, relating to fair value measurements, defines fair value and establishes a framework for measuring fair value. The ASC 820 fair value hierarchy distinguishes between market participant assumptions developed based on market data obtained from sources independent of the reporting entity and the reporting entity’s own assumptions about market participant assumptions, ~~developed~~ based on the ~~best~~available information ~~available~~deemed best in the circumstances. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In addition, the fair value of assets and liabilities should include consideration of non-performance risk, which for the liabilities described below includes the Company’s own credit risk.

Level 2 - Quoted prices for similar assets and liabilities in active markets or inputs that are observable

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities

Financial Instruments that are not Measured at Fair Value on a Recurring Basis

The estimated fair values of the Company’s financial instruments that are not measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows:

Schedule of ~~Hierarchy Categorized~~Financial Instruments not Measured at Fair Value on ~~Fair Value~~a Recurring Basis

Nonfinancial Instruments that are Measured at Fair Value on a Nonrecurring Basis

During the third quarter of ~~2022,~~2023, the Company considered whether events or changes in circumstances had occurred since December 31, ~~2021~~2022 that could indicate whether the carrying amounts of the vessels, including operating right-of-use assets, in the Company’s fleet, and whether the carrying value of the Company’s intangible assets, may not be recoverable as of September 30, ~~2022.~~2023. The Company concluded that no such events or changes in circumstances had occurred.

For the three months ended September 30, ~~2022~~2023 and ~~2021,~~2022, the Company recorded an income tax ~~(provision)/benefit~~expense of $~~(1,522)~~4,471 and $~~4,515~~1,522, respectively, which represented effective tax rates of 1020.3% and 2210.3%, respectively. The increase in the effective tax rate for the three months ended September 30, 2023 compared to the three months ended September 30, 2022 was primarily due to the tonnage tax exclusion. For the nine months ended September 30, ~~2022~~2023 and ~~2021,~~2022, the Company recorded an income tax ~~(provision)/benefit~~expense of $~~(2,074)~~9,131 and $~~13,195~~2,074, respectively, which represented effective tax rates of 1117.9% and 2411.2%, respectively. The ~~decrease~~increase in the effective tax rate for the ~~three and~~nine months ended September 30, 2023 compared to the nine months ended September 30, 2022 ~~compared~~was primarily due to the ~~three and~~tonnage tax exclusion. The effective tax rate for the nine months ended September 30, ~~2021~~2023 was ~~substantially~~less than the statutory rate due to a favorable Louisiana law change and the tonnage tax exclusion. The effective tax rate for the nine months ended September 30, 2022 was less than the statutory rate due to the tonnage tax exclusion. ~~The effective tax rate for the nine months ended September 30, 2021 was more than the statutory rate due to the tonnage tax exclusion and state tax benefit.~~

~~On June 13, 2022, the Company’s Board of Directors authorized a program to purchase up to~~ ~~five million~~ shares of the Company’s common stock. Under the program, the Company repurchased shares from time to time in open market transactions (including the use of trading plans under SEC Rule 10b5-1) or in privately negotiated transactions. For the three and nine months ended September 30, 2022, the Company repurchased ~~3,633,146~~ ~~and~~ ~~3,778,887~~ ~~shares, respectively, at average prices of $2.95~~ ~~and $2.92~~ ~~per share, respectively. In October 2022, the Company repurchased~~ ~~1,221,113~~ ~~shares at an average price of $3.04, completing the program. The Company spent $14,739~~ ~~to repurchase the~~ ~~five million~~ ~~shares at an average price of $2.95~~.

~~During the three and nine months ended September 30, 2022, in connection with the vesting of restricted stock units (“RSUs”), the Company withheld~~ ~~60,646~~ ~~and~~ ~~239,686, respectively, shares of Class A common stock at average prices of $2.05~~ ~~and $2.07~~ per share (based on the market prices on the dates of vesting), respectively, from certain members of management to cover withholding taxes. During the nine months ended September 30, 2021, in connection with the vesting of RSUs, the Company withheld ~~185,459~~ ~~shares of Class A common stock at an average price of $2.18~~ ~~per share (based on the market prices on the dates of vesting) from certain members of management to cover withholding taxes.~~

~~During the nine months ended September 30, 2022, the Company issued~~ ~~11,179~~ ~~shares of Class A common stock as a result of the exercise of~~ ~~59,124~~ ~~Class A warrants. During the nine months ended September 30, 2021, the Company did not issue any shares of Class A common stock as a result of the exercise of Class A warrants.~~

In September 2023, the Company purchased 13,851,382 warrants for the Company’s common stock from entities managed by Cyrus Capital Partners, L.P. (“Cyrus”), a major stockholder of the Company, for total consideration of $11,384. The warrants purchased, which were exercisable for 2,631,763 shares of the Company’s Class A common stock and represented all of the warrants held by Cyrus, were cancelled subsequent to the purchase. At September 30, 2023, the Company had 4,519,504 warrants outstanding convertible into 858,706 shares.

On March 17, 2023, the Company’s Board of Directors (the “Board”) authorized a program (the “program”) to purchase up to $10,000 of the Company’s common stock. In June 2023, the Board authorized the repurchase of an additional $10,000 of common stock, raising the total value of the program to $20,000. Under the program, the Company may repurchase shares from time to time in open market transactions or in privately negotiated transactions.

In August 2023, the Company purchased 3,788,639 shares of the Company’s common stock from entities managed by Cyrus at a price of $4.05 per share for total consideration of $15,344. Including these transactions, for the three and nine months ended September 30, 2023, the Company repurchased 4,580,921 and 7,174,059 shares, respectively, for $18,653 and $28,499, respectively, at an average price of $4.07 and $3.97 per share, respectively. At September 30, 2023, the Company had a remaining authorization under the program of $6,844 for share repurchases.

During the nine months ended September 30, 2023 and 2022, the Company issued 128,943 and 11,179 shares of Class A common stock, respectively, as a result of the exercise of 680,892 and 59,124 Class A warrants, respectively.

The Company accounts for stock compensation expense in accordance with the fair value-based method required by ASC 718, Compensation – Stock Compensation. This method requires share-based payment transactions to be measured based on the fair value of the equity instruments issued.

On June 15, 2023 and June 1, 2022, ~~and May 27, 2021,~~ the Company awarded ~~305,000~~195,800 and ~~275,800~~305,000 time-based RSUs, respectively, to its non-employee directors. The grant date fair values of these awards were $~~2.09~~3.83 and $~~2.29~~2.09 per RSU, respectively. Each RSU represents a contingent right to receive one share of Class A common stock upon vesting. These RSUs vest in full on the first anniversary of the grant date, subject to each director continuing to provide services to the Company through such date.

During the nine months ended September 30, ~~2022~~2023 and ~~2021,~~2022, the Company granted RSUs to its employees, including senior officers, covering ~~718,360~~584,922 and ~~552,844~~718,360 shares, respectively. The grant date fair values of these awards were $~~2.09~~2.90 and $~~2.36~~2.09 per RSU, respectively. Each RSU represents a contingent right to receive one share of Class A common stock upon vesting. Each award vests in approximately equal installments on each of the first three anniversaries of the grant date.

During the nine months ended September 30, ~~2022~~2023 and ~~2021,~~2022, the Company awarded performance-based RSUs to its senior officers ofcovering ~~518,600~~416,832 and ~~363,238~~518,600 shares, respectively (which amounts may be increased up to a maximum of ~~777,900~~625,248 and ~~544,857~~777,900 shares, respectively, based upon performance). Each performance-based RSU represents a contingent right to receive RSUs based upon continuous employment, subject to the achievement of performance metrics through the end of a three-year performance period. The grant date fair values of the awards, which ~~have a market condition,~~are subject to performance conditions, were determined to be $~~2.09~~2.90 and $~~2.36~~2.09 per RSU, respectively.

During the nine months ended September 30, 2022, the Company awarded RSUs to its senior officers covering 576,981 shares. The grant date fair value of these awards was $2.09. Each award of RSUs vest as follows: ~~i.)~~ 20% vests on the first anniversary of the grant date, ~~ii.)~~ 30% vests on the second anniversary of the grant date, and ~~iii.)~~ 50% vests on the third anniversary of the grant date. Each RSU represents a contingent right to receive one share of Class A common stock upon vesting.

During the nine months ended September 30, ~~2021,~~2023 and 2022, in connection with the vesting of restricted stock units (“RSUs”), the Company ~~awarded performance-based RSUs to its senior officers covering~~withheld ~~590,251~~333,085 ~~shares. The grant date fair value~~and 179,040 shares of ~~these awards was~~Class A common stock, respectively, at an average price of $~~2.36~~3.51 and $2.07 per ~~RSU. Each performance-based RSU represents a contingent right~~share (based on the market prices on the dates of vesting), respectively, from certain members of management to ~~receive RSUs based on performance criteria tied to specific operational and financial goals to be achieved over an 18-month performance period.~~cover withholding taxes.

~~The components of accumulated other comprehensive income, net of related taxes, in the condensed consolidated balance sheets follow:~~

The components of accumulated other comprehensive income, net of related taxes, in the condensed consolidated balance sheets follow:

The following tables present the changes in the balances of each component of accumulated other comprehensive ~~income/(loss),~~income, net of related taxes, during the three and nine months ended September 30, ~~2022~~2023 and ~~2021:~~2022:

Schedule of Changes in Balances of Component of Accumulated Other Comprehensive Loss

	Items not yet recognized as a component of net periodic benefit cost (pension and other postretirement plans)			Items not yet recognized as a component of net periodic benefit cost (pension and other postretirement plans)

Balance as of June 30, 2022	$	2,582
Balance as of June 30, 2023				$	3,026
Current period change, excluding amounts reclassified from accumulated other comprehensive income		—			—
Amounts reclassified from accumulated other comprehensive income		(180	)		(192	)
Total change in accumulated other comprehensive income		(180	)		(192	)
Balance as of September 30, 2023				$	2,834

Balance as of June 30, 2022				$	2,582
Current period change, excluding amounts reclassified from accumulated other comprehensive loss					—
Amounts reclassified from accumulated other comprehensive income					(180	)
Total change in accumulated other comprehensive income					(180	)
Balance as of September 30, 2022	$	2,402		$	2,402

Balance as of June 30, 2021	$	(480	)
Current period change, excluding amounts reclassified from accumulated other comprehensive loss		—
Amounts reclassified from accumulated other comprehensive loss		(100	)
Total change in accumulated other comprehensive loss		(100	)
Balance as of September 30, 2021	$	(580	)

	Items not yet recognized as a component of net periodic benefit cost (pension and other postretirement plans)			Items not yet recognized as a component of net periodic benefit cost (pension and other postretirement plans)

Balance as of December 31, 2021	$	2,943
Balance as of December 31, 2022				$	3,410
Current period change, excluding amounts reclassified from accumulated other comprehensive income		—			—
Amounts reclassified from accumulated other comprehensive income		(541	)		(576	)
Total change in accumulated other comprehensive income		(541	)		(576	)
Balance as of September 30, 2023				$	2,834

Balance as of December 31, 2021				$	2,943
Current period change, excluding amounts reclassified from accumulated other comprehensive loss					—
Amounts reclassified from accumulated other comprehensive income					(541	)
Total change in accumulated other comprehensive income					(541	)
Balance as of September 30, 2022	$	2,402		$	2,402

Balance as of December 31, 2020	$	(282	)
Current period change, excluding amounts reclassified from accumulated other comprehensive loss		—
Amounts reclassified from accumulated other comprehensive loss		(298	)
Total change in accumulated other comprehensive loss		(298	)
Balance as of September 30, 2021	$	(580	)

The Company includes the service cost component for net periodic benefit cost/(income) in vessel expenses and general and administrative expenses and other components in other (expense)/income, net on the condensed consolidated statements of operations.

In October 2023, the Company entered into new bareboat charter agreements in respect of the seven vessels comprising OSG’s Veteran Class products tanker fleet, all of which are now indirectly owned by a private fund (the “MP Fund”) managed by Maritime Partners, LLC. The economic terms of the bareboat charters remain the same as the previous bareboat charters. Prior to their recent acquisition by a Jones Act qualified subsidiary of the MP Fund, these seven vessels were previously owned indirectly by AMSC ASA (“AMSC”). The previous charters with AMSC for two of the seven chartered-in vessels contained a deferred payment obligation (“DPO”), which was $6,514 at September ~~2022,~~ 30, 2023, related to charter hire expense incurred by the Company in prior years and was payable to AMSC in future periods. As part of the new agreements, the Company prepaid, at a discount, $5,602 to the MP Fund, representing all of its remaining outstanding DPO.

In August 2023, the Company extended its lease on the ~~Company’s Tampa, Florida office space~~ Overseas Key West for an additional lease term of ~~five years and~~ two months ~~expiring in October 2028.~~to April 2029. Upon reassessment, the lease is accounted for as an operating lease. It was previously accounted for as a finance lease. The future minimum commitments under the lease are $1,550 for 2023, $4,172 for 2024, $4,161 for 2025, $4,161 for 2026, $4,161 for 2027, and $5,449 thereafter. For the nine months ended September 30, 2023, the non-cash activity for obtaining an operating right-of-use asset and liability was not material as a result of the lease extension.

In March 2023, the Company extended its lease on the Alaskan Frontier for an additional lease term of three years, to March 2026. The lease is accounted for as an operating lease. The future minimum commitments under the lease are $~~141~~92 for the remainder of ~~2022, $547~~ in 2023, $~~515~~366 in 2024, $~~530~~365 in 2025, and $~~546~~71 in ~~2026, $562~~ ~~in 2027 and $382~~ ~~thereafter.~~2026. For the ~~three~~nine months ended September 30, ~~2022,~~2023, the Company had non-cash operating activity of approximately $~~2,088~~1,000 for obtaining an operating right-of-use asset and liability as a result of the lease extension. Subsequently, the Company entered into an agreement with BP Oil Shipping Company, USA, in October 2023, to purchase the Alaskan Frontier for $20,000. The purchase is expected to be completed in November 2023. OSG intends to reactivate the 1.3-million-barrel capacity tanker which has been in cold layup in Malaysia since 2019. OSG plans to make investments in the vessel for it to begin commercial trade by the fourth quarter of 2024.

The Company is the lessor under its time charter contracts. Total time charter revenue for the three and nine months ended September 30, 2023 was equal to income from lease payments of $90,801 and $262,087, respectively, plus straight-line adjustments of $2,423 and $2,534, respectively. For the three and nine months ended September 30, 2022, total time charter revenue was equal to income from lease payments of $92,539 and $232,360, respectively, plus straight-line adjustments of $191 and $574, respectively. ~~For the three and nine months ended September 30, 2021, total time charter revenue was equal to income from lease payments of $64,551~~ ~~and $190,673, respectively, less straight-line adjustments of $~~16 ~~for the three months ended September 30, 2021 and plus straight-line adjustments of $457~~ ~~for the nine months ended September 30, 2021.~~

The Company is a party, as plaintiff or defendant, to various suits in the ordinary course of business for monetary relief arising principally from personal injuries (including exposure to asbestos and other toxic materials), wrongful death, collision or other casualty and to claims arising under charter parties. A substantial majority of such personal injury, wrongful death, collision or other casualty claims against the Company are covered by insurance (subject to deductibles not material in amount). In the opinion of management, none of these claims, individually or in the aggregate, are expected to be material to the Company’s financial position, results of operations and cash flows.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among others, statements about our beliefs, plans, objectives, goals, expectations, estimates and intentions that are subject to significant risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. The words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “target,” “goal,” and similar expressions are intended to identify forward-looking statements.

All forward-looking statements, by their nature, are subject to risks and uncertainties. Our actual future results may differ materially from those set forth in our forward-looking statements. Please see the section titled “Forward-Looking Statements” and Item 1A. Risk Factors of our Form 10-K. Other factors besides those listed in our Form 10-K and in our quarterly reports also could adversely affect our results, and you should not consider any such list of factors to be a complete set of all potential risks or uncertainties. The following highlights some of these risk factors:

The Company assumes no obligation to update or revise any forward-looking statements, except as may be required by law. Forward-looking statements in this Quarterly Report on Form 10-Q and written and oral forward-looking statements attributable to the Company or its representatives after the date of this Quarterly Report on Form 10-Q are qualified in their entirety by the cautionary statement contained in this paragraph and in other reports filed by the Company with the SEC.

OSG is a publicly traded ~~tanker~~ company providing liquid bulk and energy transportation services for crude oil and petroleum products in the U.S. Flag markets. ~~OSG is a major operator of tankers and ATBs in~~In January 2023, the ~~Jones Act industry. OSG’s active vessel fleet, of which 22 are~~Overseas Sun Coast was converted to U.S. Flag ~~vessels,~~status, joining the rest of OSG’s U.S. Flag fleet. OSG’s U.S. Flag fleet consists of ~~three~~Suezmax crude oil tankers doing business in Alaska, ~~two~~ conventional ~~ATBs, two~~and lightering ATBs, ~~three~~ shuttle ~~tankers, ten~~and conventional MR tankers, and ~~two~~ non-Jones Act MR tankers that participate in the U.S. ~~Maritime~~Tanker Security ~~Program. The Company also owns and operates one Marshall Islands flagged MR tanker that trades internationally. As previously announced, in December 2022,~~Program (“TSP”) or are on time charter to the U.S. Military Sealift Command. In October 2023, the Company ~~will redeliver three conventional tankers leased from American~~entered into an agreement with BP Oil Shipping ~~Company.~~Company, USA to purchase the Alaskan Frontier. The purchase is expected to be completed in November 2023. OSG intends to reactivate the 1.3-million-barrel capacity tanker which has been in cold layup in Malaysia since 2019. OSG plans to make significant investments in the vessel for it to begin commercial trade by the fourth quarter of 2024. OSG is committed to setting high standards of excellence for its quality, safety and environmental programs. OSG is recognized as one of the world’s most customer-focused marine transportation companies and is headquartered in Tampa, FL. Our revenues are derived predominantly from time charter agreements for specific periods of time at fixed daily amounts. We also charter-out vessels for specific voyages where we typically earn freight revenue at spot market rates.

The following is a discussion and analysis of our financial condition and results of operations for the three and nine months ended September 30, ~~2022~~2023 and ~~2021.~~2022. This Quarterly Report on Form 10-Q includes industry data and forecasts that we have prepared based in part on information obtained from industry publications and surveys. Third-party industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable. In addition, certain statements regarding our market position in this report are based on information derived from internal market studies and research reports. Unless we state otherwise, statements about the Company’s relative competitive position in this report are based on management’s beliefs, internal studies and management’s knowledge of industry trends.

All dollar amounts are in thousands, except daily dollar amounts and per share amounts.

Our revenues are highly sensitive to patterns of supply and demand for vessels of the size and design configurations owned and operated by us and the trades in which those vessels operate. Rates for the transportation of crude oil and refined petroleum products are determined by market forces such as the supply and demand for oil, the distance that cargoes must be transported, and the number of vessels expected to be available at the time cargoes need to be transported. In the Jones Act trades within which the substantial majority of our vessels operate, demand factors for transportation are affected almost exclusively by supply and distribution decisions of oil producers, refiners and distributors based in the United States. Further, the demand for U.S. domestic oil shipments is significantly affected by the state of the U.S. and global economies, the level of imports into the U.S. from OPEC and other foreign producers, oil production in the United States, and the relative price differentials of U.S. produced crude oil and refined petroleum products as compared with comparable products sourced from or destined for foreign markets, including the cost of transportation on international flag vessels to or from those markets. The number of vessels is affected by newbuilding deliveries and by the removal of existing vessels from service, principally through storage, layup, deletions, or conversions. Our revenues are also affected by the mix of charters between spot (voyage charters which include short-term time charters) and long-term (time or bareboat charters).

The ~~Russian Ukrainian~~Russia/Ukraine conflict has resulted in economic sanctions against Russia, ~~which include~~including the banning or limitation of oil imports from Russia by certain countries and self-sanctioning by many oil companies and traders. In December 2022, the EU ~~is scheduled to ban~~banned waterborne crude oil imports from ~~Russia. The~~Russia and the G7 nations ~~are working on~~implemented a price ~~capping scheme~~cap limiting the global price paid for Russian oil. Some countries have taken advantage of the current availability of Russian crude oil sold at a discount to world prices. ~~The~~These circumstances have resulted in the redirection of oil (crude and refined product) trade flows, which are apt to continue, reflecting the ~~need~~needs of countries that were large consumers of Russian oil to obtain other supply sources. Although the United States was not a major importer of Russian oil, it is impacted by these global events. Crude and refined products that were previously imported into the United States from non-Russian sources may not be available in prior quantities. AAnother potential impact is more movement from domestic producing locations via pipeline and marine assets, which would ~~have an impact on~~increase vessel demand. An increase in demand could result in higher utilization levels and potentially higher rates for Jones Act vessels.

~~During the COVID-19 pandemic we placed seven vessels~~Renewable diesel produces less carbon dioxide and nitrogen oxide than conventional diesel. As it is chemically identical to regular diesel, it can be used on its own or blended with conventional diesel. Production of renewable diesel increased in layup in order to allow us to reduce the operating costs associated with vessels that were without charter. As demand returned, in the fall of 2021 we began to bring vessels out of layup and operate them in the spot market. In January 2022 and ~~late February 2022, two more vessels came out~~is expected to grow significantly by 2025 as governments implement policies to encourage further growth of ~~layup. We continued~~this fuel, including California’s Low Carbon Fuel Standard. The U.S. Gulf Coast currently produces a significant proportion of U.S renewable diesel, and California has been a large consumer of renewable diesel. Marine transportation provides the most cost-effective solution to ~~see an~~move finished product to the West Coast. The length of the trip to California creates a significant increase in ton mile demand, ~~during the first half of 2022 and as~~creating a result, our last two vessels in layup returned to service in May 2022. During 2022, we started to see a resumption of more typical customer behavior, with charterers entering into longer term time charter agreements.

~~During the pandemic and continuing today, we implemented procedures to protect the health and safety of our employees, crew and contractors, as mandated or recommended by the Centers~~large new market for Disease Control and Prevention, the U.S. Coast Guard, local ports and shipyards, and country- and state-specific requirements. COVID-19 has continued to impact planned shipyard maintenance and vetting activities, resulting in delays, rescheduling and extensions. These additional procedures and delays have resulted in increased costs, which at this point in time, have not been material but are expected to continue and may increase.Jones Act shipping.

Having our vessels committed on time charters is a fundamental objective of our chartering strategy. We seek to have a majority of available vessel operating days covered with time charters or contracts of affreightment, but if such charters are not remunerative, or prove ~~achievable~~unachievable under certain market conditions, some of our vessels may operate in the spot market, which is more volatile and less predictable. Because shipping revenues and voyage expenses are significantly affected by the mix between voyage charters and time charters, we manage our vessels based on TCE revenues and rates, which are non-GAAP measures.

~~The increase in demand~~Continued lack of available tonnage throughout the third quarter of 2023 contributed to minimal spot activity for Jones Act tankers and ~~ATBs that started in~~ATBs. Charterers are increasing the ~~fourth quarter~~duration of ~~2021 and continued into the third quarter of 2022 has caused charterers to secure~~some new time charter contracts ~~rather than relying on the spot market. This resulted in fewer~~to secure tonnage for multi-year periods. There are few vessels available in the spot market and total spot activity ~~decreased from 15~~was 11 spot fixtures ~~in the second quarter of 2022 to seven~~ in the third quarter of ~~2022.~~2023. For the ~~seven~~11 spot fixtures, ~~one was~~two were performed by ~~a tanker~~tankers and the ~~remaining~~others were performed by ATBs.

Our vessels were employed for ~~98%~~100% of available days during the third quarter of ~~2022,~~2023, with ~~33 of~~ a total ~~1,852~~of 1,590 available days (excluding 7657 days for vessels that were off-hire due to drydock requirements) seeing no vessels idle without employment. Industry-wide, there were no firm Jones Act vessel orders as of September 30, ~~2022.~~2023.

Delaware Bay lightering volumes averaged 61,000 b/d in the third quarter of 2023 compared with 65,000 b/d in the third quarter of ~~2022 compared with 60,000 b/d in the third quarter of 2021.~~2022. We have contract minimums with our refinery customers that compensate us for barrels not lightered below minimum amounts.

The Company’s consolidated financial statements are prepared in accordance with GAAP, which requires the Company to make estimates in the application of its accounting policies based on the best assumptions, judgments and opinions of management. There have been no changes to the Company’s critical accounting estimates disclosed in Note 2, “Summary of Significant Accounting Policies,” to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for ~~2021.~~2022.

In December 2022 we redelivered three conventional tankers leased from American Shipping Company. The reduction in the number of vessels we operated in 2023 were the primary reasons for decreases in our revenues in 2023 compared to the comparable periods in 2022. There were additional items that impacted our revenues both positively and negatively which are described below.

During the three months ended September 30, 2023, shipping revenues decreased by $7,624, or 6.2%, compared to the same period in 2022. In addition to the changes in the number of vessels we operate, there was an 8-day increase in drydock days and a decrease in Delaware Bay lightering volumes. The decrease was partially offset by an increase in average daily rates earned by our fleet and one full Government of Israel voyage and one partial Government of Israel voyage that began during the third quarter of 2023 and overlapped into the fourth quarter compared to two partial Government of Israel voyages in the third quarter of 2022.

For the nine months ended September 30, 2023, shipping revenues decreased by $9,191, or 2.7%, compared to the nine months ended September 30, 2022. In addition to the changes in the number of vessels we operate, there were fewer Military Sealift Command (“MSC”) voyages during the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022, which were longer international voyages. The decrease in shipping revenues ~~increased~~was partially offset by ~~$29,092 and $81,443, or 31.0% and 30.9%, respectively, compared to the same periods in 2021. The increases primarily resulted from 599-day and 1,522-day decreases, respectively,~~a 337-day decrease in layup ~~days, as we~~days. We had ~~fewer~~no vessels in layup ~~compared to~~during the ~~same periods in 2021.~~ nine months ended September 30, 2023. During the first quarter of 2022, we had two vessels in layup for the full quarter and two additional vessels that came out of layup in January 2022 and late February 2022. Our remaining two vessels in layup returned to service in May 2022. ~~We had seven vessels~~Additionally, the decrease was partially offset by (a) an increase in ~~layup for most of 2021 with two of seven vessels coming out of layup~~average daily rates earned by our fleet, (b) an increase in ~~September 2021.~~Delaware Bay lightering volumes, (c) a 5-day decrease in drydock days and (d) an 8-day decrease in repair days.

Reconciliation of TCE revenues, a non-GAAP measure, to shipping revenues as reported in the consolidated statements of operations follows:

	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021		2023		2022		2023		2022
Time charter equivalent revenues	$	115,062	$	75,365	$	312,229	$	212,569	$	108,577	$	115,062	$	313,438	$	312,229
Add: Voyage expenses		7,997		18,602		32,813		51,030		6,858		7,997		22,413		32,813
Shipping revenues	$	123,059	$	93,967	$	345,042	$	263,599	$	115,435	$	123,059	$	335,851	$	345,042

The following tables provide a breakdown of TCE rates achieved for the three and nine months ended September 30, ~~2022~~2023 and ~~2021~~2022 between spot and fixed earnings and the related revenue days. Prior period amounts have been updated to conform to current period presentation.

	2022				2021				2023				2022
Three Months Ended September 30,	Spot Earnings		Fixed Earnings		Spot Earnings		Fixed Earnings
Three months ended September 30,									Spot Earnings		Fixed Earnings		Spot Earnings		Fixed Earnings
Jones Act Handysize Product Carriers:
Average rate	$	38,296	$	60,923	$	37,527	$	66,704	$	—	$	67,694	$	38,296	$	60,923
Revenue days		55		1,086		219		449		—		903		55		1,086
Non-Jones Act Handysize Product Carriers:
Average rate	$	47,779	$	38,911	$	43,265	$	9,083	$	43,834	$	68,875	$	47,779	$	38,911
Revenue days		184		92		184		92		189		60		184		92
ATBs:
Average rate	$	41,117	$	35,590	$	—	$	36,146	$	—	$	44,354	$	41,117	$	35,590
Revenue days		85		99		—		182		—		247		85		99
Lightering:
Average rate	$	71,086	$	46,906	$	60,063	$	—	$	89,255	$	—	$	71,086	$	46,906
Revenue days		135		49		92		—		94		—		135		49
Alaska ^(a):
Average rate	$	—	$	60,438	$	—	$	57,936	$	—	$	61,016	$	—	$	60,438
Revenue days		—		250		—		276		—		254		—		250

During the third quarter of ~~2022,~~2023, TCE revenues ~~increased~~decreased by ~~$39,697,~~$6,485, or ~~52.7%~~5.6%, to ~~$115,062~~$108,577 from ~~$75,365~~$115,062 in the third quarter of ~~2021.~~ 2022. The ~~increase primarily resulted from~~ ~~a 599-day~~ decrease in layup days, as we did not have any vessels in layup during the third quarter of 2022 compared to seven vessels in layup for most of the third quarter of 2021, with two of seven vessels coming out of layup in September 2021. Additionally, the increase in TCE revenues ~~resulted from an increase~~was primarily driven by the decrease in ~~average daily rates earned by our fleet and an increase in Delaware Bay lightering volumes. The increase was partially offset by a decrease related to a 54-day increase in scheduled drydocking.~~shipping revenues explained above.

Voyage expenses decreased by ~~$10,605,~~$1,139, or ~~57.0%~~14.2%, in the third quarter of ~~2022~~2023 to ~~$7,997~~$6,858 compared to ~~$18,602 in the third quarter of 2021, primarily related to an absence of expenses for oil pollution mitigation services for the Alaskan tankers~~$7,997 in the third quarter of 2022, compared to $10,070 of these expenses during the third quarter of 2021. These expenses were previously passed through to the charterer each month; however, the charterer is now paying the expenses directly to the vendor. ~~Additionally, the decrease in voyage expenses was~~primarily due to decreases in ~~port and~~ fuel expenses, as our vessels performed fewer voyage charters during the third quarter of ~~2022~~2023 compared to the third quarter of ~~2021.~~2022.

Vessel expenses ~~increased~~decreased by ~~$9,424,~~$5,461, or ~~26.2%~~12.0%, in the third quarter of ~~2022~~2023 to ~~$45,430~~$39,969 compared to ~~$36,006~~$45,430 in the third quarter of ~~2021,~~2022, primarily due to ~~an increase in crewing costs. The increase~~a decrease in crewing costs ~~was~~ related to ~~not having any vessels~~ ~~in layup during the third quarter of 2022 compared to seven~~fewer vessels in ~~layup for most~~our fleet, as we redelivered three conventional tankers leased from American Shipping Company in December 2022.

Charter hire expenses decreased by $6,510, or 28.6%, to $16,233 in 2023 from $22,743 in 2022. The decrease primarily resulted from the redelivery of ~~the third quarter of 2021 with two of seven vessels coming out of layup~~three conventional tankers leased from American Shipping Company in ~~September 2021.~~December 2022.

Depreciation and amortization ~~increased~~decreased by ~~$2,376,~~$899, or ~~15.3%~~5.0%, to $17,003 in the third quarter of 2023 compared to $17,902 in the third quarter of ~~2022 compared to $15,526 in the third quarter of 2021.~~2022. The ~~increase~~decrease primarily resulted from ~~an increase~~a decrease in amortization of drydock costs.

During the nine months ended September 30, ~~2022,~~2023, TCE revenues increased ~~$99,660,~~$1,209, or ~~46.9%~~0.4%, to $313,438 from $312,229 ~~from $212,569 for~~during the nine months ended September ~~20, 2021.~~30, 2022. The increase primarily resulted from ~~a 1,522-day~~the decrease in ~~layup days as we had fewer vessels~~shipping revenues explained above offset by the decrease in ~~layup~~voyage expenses explained below.

Voyage expenses decreased by $10,400, or 31.7%, during the nine months ended September 30, 2023 to $22,413 compared to $32,813 during the nine months ended September 30, 2022, ~~compared~~primarily due to ~~the same period~~decreases in ~~2021. During the first quarter of 2022, we had two~~fuel and port expenses, as our vessels in layup for the full quarter and two additional vessels that came out of layup in January 2022 and late February 2022. Our remaining two vessels in layup returned to service in May 2022. We had seven vessels in layup for most of the nine months ended September 30, 2021 with two of seven vessels coming out of layup in September 2021. Additionally, the increase in TCE revenues resulted from (a) an increase in average daily rates earned by our fleet, (b) seven full Military Sealift Command voyages, which were longer international voyages,performed fewer voyage charters during the nine months ended September 30, ~~2022~~2023 compared to four such voyages during the same period in 2021 and (c) four full Government of Israel voyages and one partial Government of Israel voyage that overlapped into the fourth quarter during the nine months ended September 30, 2022 compared to three full and one partial of such voyages during the same period in 2021. The increase was partially offset by (a) one less MR tanker in our fleet, ~~Overseas Gulf Coast~~~~, which was sold in mid-June 2021, (b) a 78-day increase in scheduled drydocking, (c) an 18-day increase in repair days and (d) a decrease in Delaware Bay lightering volumes.~~

Voyage expenses decreased by $18,217, or 35.7%, for the nine months ended September 30, 2022 to $32,813 compared to $51,030 for the nine months ended September 30, 2021, primarily related to an absence of expenses for oil pollution mitigation services for the Alaskan tankers during the nine months ended September 30, 2022 compared to $29,986 of these expenses during the nine months ended September 30, 2021. These expenses were previously passed through to the charterer each month; however, the charterer is now paying the expenses directly to the vendor. The decrease was partially offset by increases in fuel and port expenses related to higher fuel prices and more voyage charters performed by our vessels during the nine months ended September 30, 2022 compared to the same period in 2021 and an increase in freight brokerage fees due to removing vessels from layup during the nine months ended September 30, 2022.

Vessel expenses ~~increased~~decreased by ~~$28,565,~~$7,043, or ~~28.1%~~5.4%, for the nine months ended September 30, ~~2022~~2023 to ~~$130,380~~$123,337 compared to ~~$101,815 for the nine months ended September 30, 2021, primarily due to an increase in crewing costs. The increase in crewing costs was related to fewer~~ ~~vessels in layup during the nine months ended September 30, 2022 compared to the nine months ended September 30, 2021.~~

~~Depreciation and amortization increased by $5,145, or 11.2%, to $51,058~~$130,380 for the nine months ended September 30, 2022, ~~compared~~primarily due to ~~$45,913~~a decrease in crewing costs related to fewer vessels in our fleet as we redelivered three conventional tankers leased from American Shipping Company in December 2022.

Charter hire expenses decreased by $19,101, or 28.5%, to $47,988 for the nine months ended September 30, ~~2021.~~2023 from $67,089 for the nine months ended September 30, 2022. The ~~increase~~decrease primarily resulted from ~~an increase~~the redelivery of three conventional tankers leased from American Shipping Company in December 2022.

Depreciation and amortization decreased by $1,558, or 3.1%, to $49,500 during the nine months ended September 30, 2023 compared to $51,058 during the nine months ended September 30, 2022. The decrease primarily resulted from a decrease in amortization of drydock costs.

~~Our two U.S. Flag Product Carriers participate in~~In April 2023, three of our vessels were accepted into the ~~Maritime Security Program, which~~TSP. The program is designed to ensure that militarily useful U.S. Flag tank vessels are available to the U.S. Department of Defense in the event of war or national emergency. WeThe initial program calls for 10 tankers to participate. Under the TSP, participants receive an annual stipend ~~subject~~designed to reduce vessel expenses to a level that will allow them to compete for international business. We transferred the two non-Jones Act U.S. Flag Product Carriers participating in ~~each case to annual congressional appropriations, which is intended to offset the increased cost incurred by such vessels from operating under~~ the U.S. ~~Flag. For 2022, we~~Maritime Security Program to the TSP and added the Overseas Sun Coast, which was converted to U.S. Flag status in January 2023, to participate in the program. We expect to receive ~~up to $5,300~~an annual stipend of $6,000 for each ~~vessel. During 2021,~~vessel under the ~~stipend we received was $5,250 for each vessel. We do not receive a stipend for any days on which either~~TSP.

In June 2023, the MSC awarded one of our vessels, the ~~two vessels operates under~~Overseas Mykonos, a time charter contract to provide ongoing fuel transportation services to MSC in support of our nation’s defense. The time charter awarded is for a one-year base period with the MSC holding additional option periods to extend the contract out to a ~~U.S. government agency.~~maximum period of five- and one-half years. The Overseas Mykonos was transferred out of the TSP and delivered to MSC in August 2023.

General and administrative expenses ~~were~~increased by $617, or 9.4%, to $7,173 during the three months ended September 30, 2023 compared to $6,556 for the three months ended September 30, ~~2022 compared with $5,707 for the three months ended September 30, 2021.~~2022. The increase was primarily driven by higher compensation and benefits costs related to an increase in ~~headcount. General~~headcount and higher compensation levels. Additionally, general and administrative expenses ~~also~~ increased primarily due to ~~an increase~~increased travel, training and legal expenses during the three months ended September 30, 2023 compared to the same period in ~~consulting fees.~~2022.

For the nine months ended September 30, ~~2022,~~2023, general and administrative expenses ~~were~~increased by $685 or 3.3% at $21,614 compared to $20,929 ~~compared with $18,076~~ for the nine months ended September 30, ~~2021.~~2022. The increase was primarily driven by higher compensation and benefits costs related to ~~the recognition of stock~~an increase in headcount and higher compensation ~~costs for performance-based RSUs due to the fact that at the end of the second quarter of 2022 it became probable that some of the operational and financial goals specified in the RSUs were met.~~levels.

~~Loss on Disposal of Vessels and~~ Other ~~Property, Including Impairments,~~Income, Net

~~Loss on disposal of vessels and other property, including impairments,~~Other income, net was $0$1,643 and $4,184 for the three and nine months ended September 30, ~~2022~~2023, respectively, compared ~~to $960~~with $568 and $649 for the three ~~months ended September 30, 2021. The decrease was primarily related to an impairment charge of $1,000 recorded during the third quarter of 2021 on two of the Company’s leased vessels.~~

~~For the~~and nine months ended September 30, 2022, ~~loss on disposal of vessels and~~respectively. The increase in other ~~property, including impairments,~~income, net was ~~$0 compared~~primarily due to ~~$6,257 for the nine months ended September 30, 2021. The decrease was a result of the sale of the~~ ~~Overseas Gulf Coast~~ ~~during the second quarter of 2021 for $32,128, net of broker commissions and other fees, resulting in a loss, and an impairment charge of $1,000 recorded during the third quarter of 2021~~investment income earned on ~~two of the Company’s leased vessels.~~our investment accounts at higher interest rates year over year.

Interest expense was $7,779 and $24,019 for the three and nine months ended September 30, 2023, respectively, compared with $8,229 and $24,869 for the three and nine months ended September 30, ~~2022, respectively, compared with $7,052 and $20,739 for the three and nine months ended September 30, 2021, respectively.~~2022. The ~~increases~~decrease in interest expense ~~were~~was primarily due to a ~~higher rate~~lower average balance of ~~interest on our term loan, due 2028, which we entered into in September 2021 (the “New Term Loan”),~~debt outstanding during the three and nine months ended September 30, ~~2022~~2023 compared to the ~~rate of interest we were paying on our prior term loan, due 2023, during the~~ same ~~period~~periods in 2021. The prior term loan, due 2023 was paid off with proceeds from the New Term Loan. The increases were partially offset by decreases in interest expense related to the replacement and payoff of our term loan, due 2026, with proceeds from the New Term Loan in September 2021 and a prepayment of $16,000 we made on the Alaska tankers term loan, due 2025, in September 2021.2022.

For the three months ended September 30, ~~2022~~2023 and ~~2021,~~2022, we recorded an income tax ~~(provision)/benefit~~expense of ~~$(1,522)~~$4,471 and ~~$4,515,~~$1,522, respectively, which represented effective tax rates of ~~10%~~20.3% and 22%, respectively. For the nine months ended September 30, 2022 and 2021, we recorded an income tax (provision)/benefit of $(2,074) and $13,195, respectively, which represented effective tax rates of 11% and 24%10.3%, respectively. The ~~decrease~~increase in the effective tax rate for the three months ended September 30, 2023 compared to the three months ended September 30, 2022 was substantially due to the tonnage tax exclusion. For the nine months ended September 30, 2023 and 2022, we recorded income tax expense of $9,131 and $2,074, respectively, which represented effective tax rates of 17.9% and 11.2%, respectively. The increase in the effective tax rate for the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022 ~~compared~~was substantially due to the ~~three and~~tonnage tax exclusion. The effective tax rate for the nine months ended September 30, ~~2021~~2023 was ~~substantially~~less than the statutory rate due to ~~the~~a favorable Louisiana law change and tonnage tax exclusion. The effective tax rate for the nine months ended September 30, 2022 was less than the statutory rate due to the tonnage tax exclusion. ~~The effective tax rate for the nine months ended September 30, 2021 was more than the statutory rate due to the tonnage tax exclusion and state tax benefit.~~

Our business is capital intensive. Our ability to successfully implement our strategy is dependent on the continued availability of capital on attractive terms. In addition, our ability to successfully operate our business to meet near-term and long-term debt repayment obligations is dependent on maintaining sufficient liquidity.

Working capital at September 30, ~~2022~~2023 was approximately ~~$(42,000)~~$(28,000) compared with approximately ~~$(67,000)~~$(38,000) at December 31, ~~2021.~~2022. Excluding the current portion of operating and finance lease liabilities, working capital was approximately ~~$43,000~~$38,936 at September 30, ~~2022~~2023 compared to ~~$37,000~~$30,000 at December 31, ~~2021.~~2022. The increase in working capital was primarily due to an increase in ~~receivables related to~~cash and cash equivalents, as the ~~timing of collections~~Company generated cash flow from ~~our customers~~operations during the current year, and a decrease in accounts payable, accrued expenses and other current liabilities as a result of timing of accounts payable payments made through September 30, ~~2022~~2023 compared to December 31, ~~2021.~~2022. The increase in working capital was partially offset by a decrease in ~~cash and cash equivalents~~receivables related to the timing of collections from our ~~purchase~~customers and an increase in current installments of ~~a U.S. Treasury Note for $14,794~~long-term debt as ~~discussed below.~~our term loan, due 2024, matures on September 30, 2024.

As of September 30, ~~2022,~~2023, we had total liquidity on a consolidated basis comprised of ~~$73,682~~$97,598 of cash and cash equivalents. We manage our cash in accordance with our intercompany cash management system. Our cash and cash equivalents, as well as our restricted cash balances, generally exceed Federal Deposit Insurance Corporation insurance limits. We place our cash, cash equivalents and restricted cash in what we believe to be credit-worthy financial institutions. In addition, certain of our money market accounts invest in U.S. Treasury securities or other obligations issued or guaranteed by the U.S. government or its agencies.

In July 2022, we purchased a $15,000 U.S. Treasury Note for $14,794 with a maturity date of August 15, 2024. The U.S. Treasury Note is classified as investment in security to be held to maturity and is carried at amortized cost on the condensed consolidated balance sheets as we have the intent and ability to hold until maturity.

As of September 30, ~~2022,~~2023, we had total debt outstanding (net of deferred financing costs) of ~~$428,787~~$406,510 and a total debt to total capitalization of ~~55.3%~~54.3%, compared to ~~$444,740~~$423,363 and ~~56.7%~~55.5%, respectively, at December 31, ~~2021.~~2022.

We generate significant cash flows through our complementary mix of time charters, voyage charters and contracts of affreightment. Net cash provided by operating activities during the nine months ended September 30, ~~2022~~2023 was ~~$41,179.~~ $83,050. In addition to operating cash flows, our other current potential sources of funds are proceeds from additional issuances of equity securities, additional borrowings, and proceeds from the opportunistic sales of our vessels. In the past, we have also obtained funds from the issuance of long-term debt securities. However, we can give no assurance as to whether or the terms on which we may be able to issue equity or debt securities, obtain additional borrowings, or sell vessels.

We use capital to fund working capital requirements, maintain the quality of our vessels, comply with U.S. and international shipping standards, and repay our outstanding loan facilities. We also use capital to comply with environmental laws and regulations, and we expect that the costs of such compliance will continue to increase; while it is not possible to determine the amounts of such costs for any future period, we believe that they are likely to be substantial. We may also use cash generated by operations to finance capital expenditures to modernize and grow our fleet.

In October 2023, the Company entered into an agreement with BP Oil Shipping Company, USA to purchase the Alaskan Frontier, for $20,000, which the Company had been leasing. The purchase is expected to be completed in November 2023. OSG intends to reactivate the 1.3-million-barrel capacity tanker which has been in cold layup in Malaysia since 2019. OSG plans to make investments in the vessel for it to begin commercial trade by the fourth quarter of 2024.

Additionally, in October 2023, the Company entered into new bareboat charter agreements in respect of the seven vessels comprising OSG’s Veteran Class products tanker fleet, all of which are now indirectly owned by a private fund (the “MP Fund”) managed by Maritime Partners, LLC. The economic terms of the bareboat charters remain the same as the previous bareboat charters. Prior to their recent acquisition by a Jones Act qualified subsidiary of the MP Fund, these seven vessels were owned indirectly by AMSC ASA (“AMSC”). The previous charters with AMSC for two of the seven chartered-in vessels contained a deferred payment obligation (“DPO”), which was $6,514 at September 20, 2023, related to charter hire expense incurred by the Company in prior years and was payable to AMSC in future periods. As part of the new agreements, the Company prepaid, at a discount, $5,602 to the MP Fund, representing all of its remaining outstanding DPO.

In September 2023, we purchased, using available cash, 13,851,382 warrants for our common stock from entities managed by Cyrus for total consideration of $11,384. The warrants purchased, which were exercisable for 2,631,763 shares of our Class A common stock and represented all of the warrants held by Cyrus, were cancelled subsequent to the purchase.

In August 2023, we purchased 3,788,639 shares of our common stock from entities managed by Cyrus at a price of $4.05 per share for total consideration of $15,344. Including these transactions, for the three and nine months ended September 30, 2023, we used $18,652 and $28,499, respectively, of available cash to repurchase 4,580,921 and 7,174,059 shares, respectively, of our common stock at an average price of $4.07 and $3.97 per share, respectively.

As of the end of the period covered by this Quarterly Report on Form 10-Q, an evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on that evaluation, the Company’s management, including the CEO and CFO, concluded that the Company’s current disclosure controls and procedures were effective as of September 30, ~~2022~~2023 to ensure that information required to be disclosed by the Company in the reports the Company files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms and (ii) accumulated and communicated to the Company’s management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

There were no changes in the Company’s internal control over financial reporting during the quarter ended September 30, ~~2022~~2023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

We are party to lawsuits and claims arising out of the normal course of business. In management’s opinion, there are no known pending claims or litigation, the outcome of which would, individually or in the aggregate, have a material effect on our consolidated results of operations, financial position, or cash flows.

In addition to the other information set forth in this Quarterly Report, you should carefully consider the factors discussed in Part I, Item 1A. “Risk Factors” in our ~~2021~~2022 Form 10-K, and as may be updated in our subsequent quarterly reports. The risks described in our ~~2021~~2022 Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or operating results. There have been no material changes in our risk factors from those disclosed in our ~~2021~~2022 Form 10-K.

On ~~June 13, 2022,~~March 17, 2023, the Company’s Board of Directors (the “Board”) authorized a program (the “program”) to purchase up to ~~five million shares~~$10,000 of the Company’s common stock. In June 2023, the Board authorized the repurchase of an additional $10,000 of common stock, raising the total value of the program to $20,000. Under the program, the Company ~~repurchased~~may repurchase shares from time to time in open market transactions ~~(including the use of trading plans under SEC Rule 10b5-1)~~ or in privately negotiated transactions.

During the three months ended September 30, ~~2022,~~2023, purchases of our common stock under the ~~share repurchase~~ program were as follows:

In September ~~30,2022, in connection with the vesting of restricted stock awards,~~2023, the Company ~~withheld~~purchased, using available cash, 13,851,382 warrants for the ~~following number~~Company’s common stock from entities managed by Cyrus for total consideration of $11,384. The warrants purchased, which were exercisable for 2,631,763 shares of our Class A common stock ~~from certain members~~and represented all of ~~management~~the warrants held by Cyrus, were cancelled subsequent to ~~cover withholding taxes.~~the purchase.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

302 Knights Run Avenue, Tampa, Florida		33602
(Address of principal executive office)		(Zip Code)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A Common Stock (par value $0.01 per share)		OSG		New York Stock Exchange

Large accelerated filer ☐		Accelerated filer ☒		Non-accelerated filer ☐		Smaller reporting company ☒
						Emerging growth company ☐

			Page #

Part I—FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets as of September 30, ~~2022~~2023 (Unaudited) and December 31, ~~2021~~2022		3

	Condensed Consolidated Statements of Operations (Unaudited) for the three and nine months ended September 30, ~~2022~~2023 and ~~2021~~2022		4

	Condensed Consolidated Statements of Comprehensive ~~Income/(Loss)~~Income (Unaudited) for the three and nine months ended September 30, ~~2022~~2023 and ~~2021~~2022		5

	Condensed Consolidated Statements of Cash Flows (Unaudited) for the nine months ended September 30, ~~2022~~2023 and ~~2021~~2022		6

	Condensed Consolidated Statements of Changes in Equity (Unaudited) for the three and nine months ended September 30, ~~2022~~2023 and ~~2021~~2022		7

	Notes to Condensed Consolidated Financial Statements (Unaudited)		8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		1415

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	19

~~Item 4.~~	~~Controls and Procedures~~	19

~~Part II—OTHER INFORMATION~~

~~Item 1A~~	~~Risk Factors~~	20

Item 24.	~~Unregistered Sales of Equity Securities~~Controls and ~~Use of Proceeds~~Procedures		20

~~Item 3~~Part II—OTHER INFORMATION			~~Defaults upon Senior Securities~~	20

Item 41A	~~Mine Safety Disclosure~~Risk Factors	20

~~Item 5~~	~~Other Information~~	20

~~Item 6.~~	~~Exhibits~~	21

Item 2	~~Signatures~~Unregistered Sales of Equity Securities and Use of Proceeds		21

Item 3	Defaults upon Senior Securities		21

Item 4	Mine Safety Disclosure		21

Item 5	Other Information		21

Item 6.	Exhibits		22

Signatures			23

	●	the inability to attract or retain qualified mariners, as a result of labor shortages, competition to hire mariners, and other influences on the labor pool and associated costs;
	●	volatility in supply and demand in the crude oil ~~market~~and refined product markets worldwide or in the specialized markets in which the Company currently trades, which could also affect the nature and severity of certain factors listed below;
	●	uncertain economic, political and governmental conditions in the United States or abroad, and conditions in the oil and natural gas industry, such as the Russia/Ukraine ~~conflict, reactions to~~war, recent developments in the ~~COVID-19 pandemic,~~ Middle East, other geopolitical developments, or ~~otherwise~~;otherwise;
	●	public health threats, particularly the COVID-19 pandemic, which has impacted and continues to impact the Company in many ways, including those noted below, as well as by increasing operating costs to protect the health and safety of the Company’s crew members and others in the industry;
	●	increasing operating costs, unexpected drydock costs, and/or increasing capital expenses as a result of supply chain limitations, lack of availability of materials and of qualified contractors and technical experts, the consolidation of suppliers, ~~inflation, the age of the Company’s vessels, including increases due to limited shipbuilder warranties, or the refusal of certain customers to use vessels of a certain age;~~and inflation;
	●	challenges associated with compliance with complex environmental laws and regulations, including those relating to the emission of greenhouse gases and ballast water treatment, and corresponding increases in expenses;
	●	work stoppages or other labor disruptions by the unionized employees of the Company or other companies in related industries, or the impact of any potential liabilities resulting from withdrawal from participation in multiemployer plans;
	●	public health threats, such as the COVID-19 pandemic, which can impact the Company in many ways, including increasing operating costs to protect the health and safety of the Company’s crew members and others in the industry;
	●	the inability to clear oil majors’ risk assessment processes;
	●	challenges associated with compliance with complex environmental laws and regulations, including those relating to the emission of greenhouse gases and ballast water treatment, and corresponding expected increases in expenses, which expenses cannot be predicted at this time but are expected to be substantial;
	●	the effect of the Company’s indebtedness on its ability to finance operations, pursue desirable business operations and successfully run its business in the future or to generate sufficient cash to service its indebtedness and to comply with debt covenants, allowing it to maintain capital availability;
	●	the highly cyclical nature of OSG’s ~~industry;~~
	●	industry and significant fluctuations in the market value of our vessels;
	●	the Company’s ability to renew its time charters when they expire or to enter into new time charters, to replace its operating leases on favorable terms, or to compete effectively for charters;
	●	the loss of or reduction in business with any one of our large customers, changes in credit risk with respect to the Company’s counterparties on contracts, or the failure of counterparties to meet their obligations;
	●	the Company’s compliance with 46 U.S.C. sections 50501 and 55101 (commonly known as the “Jones Act”) and heightened exposure to Jones Act market fluctuations, as well as stockholder citizenship requirements imposed on us by the Jones Act, which result in restrictions on foreign ownership of the Company’s common stock;
	●	limitations on U.S. coastwise trade, the waiver, modification or repeal of the Jones Act limitations, or changes in international trade agreements; and
	●	the Company’s ability to use its net operating loss carryforwards.

	(1)	Par value $0.01 per share; 166,666,666 Class A shares authorized; ~~88,297,439~~89,496,512 and ~~87,146,851~~88,297,439 Class A shares issued as of September 30, ~~2022~~2023 and ~~2021,~~2022, respectively, and ~~84,518,552~~72,322,453 and ~~87,146,851~~84,518,552 Class A shares outstanding as of September 30, ~~2022~~2023 and ~~2021,~~2022, respectively.
	(2)	Includes ~~19,051,778~~4,519,504 and ~~19,235,764~~19,051,778 outstanding Class A warrants as of September 30, ~~2022~~2023 and ~~2021,~~2022, respectively.
	(3)	Amounts are net of tax.

	Carrying		Fair Value
	Value		Level 1		Level 2
September 30, 2022:
Assets
Cash and cash equivalents ⁽¹⁾	$	73,682	$	73,682	$	—
U.S. Treasury Note		14,803		14,487		—
Total	$	88,485	$	88,169	$	—
Liabilities
Term loan, due 2024, net	$	20,668	$	—	$	19,513
Alaska tankers term loan, due 2025, net		26,548		—		24,175
OSG 204 LLC term loan, due 2025, net		25,319		—		23,651
OSG 205 LLC and OSG Courageous II LLC term loan, due 2027, net		44,864		—		40,809
Term loan, due 2028, net		310,998		—		299,128
Unsecured senior notes, net		390		—		384
Total	$	428,787	$	—	$	407,660

As of	September 30, 2022		December 31, 2021
Items not yet recognized as a component of net periodic benefit cost (pension and other postretirement benefit plans)	$	2,402	$	2,943
Accumulated other comprehensive income	$	2,402	$	2,943

	2022				2021
Nine Months Ended September 30,	Spot Earnings		Fixed Earnings		Spot Earnings		Fixed Earnings
Jones Act Handysize Product Carriers:
Average rate	$	53,710	$	60,067	$	32,380	$	65,882
Revenue days		585		2,574		548		1,380
Non-Jones Act Handysize Product Carriers:
Average rate	$	44,720	$	29,632	$	30,684	$	9,478
Revenue days		546		273		551		428
ATBs:
Average rate	$	41,048	$	35,059	$	—	$	33,529
Revenue days		85		458		—		544
Lightering:
Average rate	$	65,758	$	46,906	$	74,169	$	—
Revenue days		363		49		273		—
Alaska (a):
Average rate	$	—	$	59,799	$	—	$	58,446
Revenue days		—		785		—		742

Period	Total Number Shares of Class A Purchased		Average Price Paid per Share of Class A
July 1, 2022 through July 31, 2022		443,224	$	2.18
August 1, 2022 through August 31, 2022		1,088,702	$	2.82
September 1, 2022 through September 30, 2022		2,101,220	$	3.13
		3,633,146	$	2.92

Period	Total Number Shares of Class A Purchased		Average Price Paid per Share of Class A
July 1, 2023 through July 31, 2023		213,596	$	4.03
August 1, 2023 through August 31, 2023 ⁽¹⁾		4,050,847	$	4.05
September 1, 2023 through September 30, 2023		316,478	$	4.32
		4,580,921	$	4.07

Period	Total Number Shares of Class A Withheld		Average Price Paid per Share of Class A
July 1, 2022 through July 31, 2022		60,646	$	2.05
August 1, 2022 through August 31, 2022		-	$	-
September 1, 2022 through September 30, 2022		-	$	-
		60,646	$	2.05


31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.

31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a), as amended.

32		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	OVERSEAS SHIPHOLDING GROUP, INC.
	(Registrant)

Date: November ~~3, 2022~~6, 2023	/s/ Samuel H. Norton
	Samuel H. Norton
	Chief Executive Officer

Date: November ~~3, 2022~~6, 2023	/s/ Richard Trueblood
	Richard Trueblood
	Chief Financial Officer
	(Mr. Trueblood is the Principal Financial Officer and has been duly authorized to sign on behalf of the Registrant)