Earnings call transcript Q2 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, and welcome to the Overseas Shipholding Group Second Quarter 2023 Earnings Release Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Sam Norton, Chief Executive Officer. ahead. go Please

Samuel H. Norton

on Welcome, opportunities presentation Drew. quarter you in of provide listening XXXX, so additional Thank current challenges the our and that financial this state commentary to us of for business second results results on and and color, and you, our allowing thank those and for of ahead. the lie

this am I our by usual, presentation joined in Dick As Trueblood. CFO,

the two PowerPoint direct to consider available everyone the I and like three regarding would an pages everyone of may them be website, and I read start, our course provided To estimates and during contents urge to The important narrative other presentation of call. that narrative on are to of statements, part the and presentation, on forward-looking this that carefully. of information this

be on perspective from risks. statements, results. by We affected forward-looking uncertainties subject an our more includes OSG factors, our those statements to today, beyond you by These about be will and just control. forward-looking differ including our statements of materially anticipated results future risk may variety presentation are factors including than historical a could contemplated offering statements Actual and and

at refer For Form XX-K which and particularly second a quarter SEC's and previously www.osg.com. our released of we site today, the our own found you internet well these as of anticipate XX-Q XX-Q, for to we can discussion our filings, XXXX, Form www.sec.gov, SEC factors, website, our the filing as be later which

legally obligation only except forward-looking to do in and assume presentation as required. any we statements speak statements today any of this Forward-looking may be as update not

on comparable reconcile most includes which our financial today website. measures, our posted which we non-GAAP closely define in to and In measures release, also earnings addition, is our presentation the GAAP certain

Solid quarter announced best morning. the characterizes this results and second OSG earlier that satisfying

our prior million. strong first EBITDA year, comfortably results, financial track guidance the (ph) with an we reached performance first for the half from on $XX on to are now equally full-year [heat] Following during adjusted quarter of having

a assets. in quarter our securities an past stock Jones quarter-end repurchase Act incrementally balances Contributing period. the from average specialized witnessed into flow including to cash first consistent allow build when in quarters our in quarter stable continued were cash returns TCE stood has million $XX second treasury our comparable consideration after higher liquid even compared $XXX the The real to several investments levels increase results, assets. with MR million, nearly and historically Positive and at taking tankers during of rates for

of market charters. over which allowed medium-term predominantly preferred the Favorable a profile our half conditions first us to consist this year contract have achieve

XX% the vessels available of Act As level fixed. XXXX now and was duration of visibility. fully of contracted the of average end over for days of XXX% with gives days forward XXXX available contract This Jones high duration months, unusually XX June, our us revenue

extended at combination Further, ten two contract the The charter in recent durations and staggered rates, to than more we strong the expect same foreseeable be do well none time. into firm quarters, fixing future open for of of financial continuing maturities bodes for results. our next the vessels

of Pacific OSG's the Overseas Command’s much for book forward tankers in saw Sealift awarded MR operations of the cover. of adding stationed During Military Defense contracts conclusion in vessels of to quarter, tender for to long-term Department be anticipated the the key the Mykonos the one of support

options lightering] earnings are time first to $XXX (ph) on extend $XX MSC exercised. million the basis firm during contract of The total a close produce year [TCE all an with to year structured in the months one than It charter, a equivalent options charter as will contract XX for to million up of is annual total. if contract, time and more

in Our these securing of at the for major least year. contracts was a success tender objective one

by role welcome that participation key vote in in supporting Tanker the of value of the OSG confidence recognition logistical the provide. a OSG's with of Program, the Security the As the we in services defense is of maritime country's played strategies requirements

delivered contract Security a will, This options U.S. TSP The to acquisition the into and working the Mykonos fill expand hand vacated last the opportunity its so We're Overseas the fleet a actively through future. tankers internationally the the in slot to do an of are creates Flag second Mykonos and to evaluating from tanker withdrawn Mykonos. MSC to by the be week, OSG result, Tanker trading as Program. for near of replace

further in our on seeking have expansion from trades. mentioned mid coastalized which opportunities sector. activities of chance expand of in an outside through increase for of the to TSP of the authorization XX we most to U.S. previous Congress' fleet been this number ships Flag As the to for calls, to are optimism ships participating operations count offers promising in add XX

is vessels engaged foreign at beginning such of potentially to year, end year, U.S. the Flag two in start good of this from realizing Moving trade a potential. by this this four to the vessels growth

vessels $XX,XXX nearly an Jones decade. ATB for years, also day, barrel charter been per two at fixtures strong committed reflect owners day. XXX,XXX $XX,XXX an reported Recent exceeding at has Turning in a two tanker that The ATB to day, to Act rate for is for indications Jones of market, at with are power tighten per for domestic seen not a primary MR and all a fixed years years fixed and barrel $XX,XXX to by a pricing end to tankers two average ATBs of continuing competitors traders. market this taken on nearly rate all XXX,XXX users per the Act most have over for time

extended July for reached this of to respective commencing During this years agreements Contract of who of we’ve past Affreightment their quarter, each OSGs lightering two X, customers year. with

expiring roughly is worth XX% charter over the the exceeded contract by volumes contract as the past increase the minimum two years. both terms Time of amounts equivalent equivalent It of on that charter have customers will at barrels minimum terms. the in earnings these minimum noting each lightering time implied in the extended committed

of one conventional has advanced these the of ships of is are days. one Alaskan open end will It all that be of conclude ATB, three Discussions future position of end vessel one the fixed and that fully these lead if a of by book exceeds time will tanker quarter, vessels. at charter all terms OSG a employment anticipated current available achieved, the tanker, to forward this for which for coming year. XX% current XXXX MR to

existing carbon actively our footprint steps OSG to fleet. intended taking reduce is incrementally the of

is some our on an report imagining component reduced sustainability our a our on in current website. these model This commitment important We of business available steps carbon a to future have with discussed and plans. of delivering footprint

associated is an MoU engines reduction achieving In consumption. reduce our signed B&W context, an recently vessels and fuel entered as goal consumption fuel two investments tankers in these existing most we emissions. annual upgrade into on MAN much a initiatives, make capital intended this engine several with the significant to of have to Of of memoranda understanding on ATC as TiOX maker to of a XX%

cost as vessels. for in Alaskan The for total on options to planned XXXX, a These up upgrades engine will concluded MoU million. upgrades, class project $XX close two includes to two if vessels of involve additional

$X.X fuel of and maintenance by emissions per be to an operating engine achieved vessel. approximately vessel, annual include estimated for tons of per upgrades reduced benefits million of COX these year X,XXX costs Expected and reduction each

to these XXXX, important, vessels continued rules current will operate in the ensure for trades beyond CII these availability ensuring foreseeable As upgrades for compliance Jones Act under future.

fleet fuel and planned towards of These include installation modifications all XXXX. will efficiencies, emissions upcoming reduce initiatives operating electronic efficiencies. and XX% by selected across by stated high use end to to Other help hulk on coatings, of improve us monitoring vessels improve gas greenhouse move the equipment reducing goal overall performance investments of propeller our performance intended consumption our

modifications industrial towards projects. Beyond emissions in have building develop of momentum global to transport months, gas hubs our reduce footprint storage development and of sequestration for facilitate scales recent COX networks continues In capture contributing considerable and a plans witnessed incrementally to greenhouse COX fleet, through capture to the reduction existing and to we intended OSG sequestration. intermediate carbon

transport recently detailed submit applications to gives competitive emerging in a OSG's this OSG from us advantage participating to Gulf COX. significant domestic intermodal grants for projects partnered of commodities with develop has transport key Department established U.S. Coast, liquid the Energy bulk for for port market. for franchise hubs the captured along operators of for

means captured is sites. COX that most in attractive connecting emitters transport the with sequestration OSG the stranded the region industrial of of believes marine

the share to on quarters viable We achieve topic with more are economically specifics new to with develop focused to this partners be to on this our in solutions vision. I you ahead. expect working able

further will second I XXXX. over you to results quarter turn details to our the now provide on Dick? Dick, for call with

Richard Trueblood

All slide right. please. we Thanks, Sam. seven, to turn If could

Board authorized $XX in Our an to authorization share increase million, by current million additional bringing million. repurchase the March XXXX. the $XX And $XX in a program program June,

million million June an In Since XXXX, XX.X Cumulatively, in returning in this total million bought through purchases the to $X August to our have shares the $X year, million. for we X. additional June we have purchases since and we we XXXX, X.X of then, repurchase for XX, shares approximately of shares XXX,XXX third Cumulatively, repurchased million shares million. quarter, the repurchased X.X second through began shareholders. XXXX shares quarter were including in for $XX.X a million $X.X

of of from on mind Act is contracted to of including business book available and XX% also and combination business Sam's Affreightment days Flag and all business international spot a eight. U.S. days. of both U.S. turn Please revenue voyages. contracted slide XXXX Keep the for represents operations, in comment, Jones that our Flag Expanding our

business contracted of This high level future the operations. of increases predictability substantially our

under over revenue this not drydock options, future of exercise contractual any to on $XXX a of off-hire lives remaining existing The currently our future estimated that business contracts. of basis, is approximately assuming our days the periods. required at any business and negotiation existing considering due factors million without the Looking book

were with expectations. quarter in-line operating Second results

their active continue meet see their future customers charters ability future We as for to to demand needs. transportation time ensure

addressed rate longer demand the contract Sam term his environment comments, As quite healthy, duration. for with remains in along

to accepted vessels, the of provides to participation annual our The into million will the Tanker a marketplace. effective TSP. vessel in the compete the $X per operating to be international the Military into Mykonos, monthly Security quarter vessels program. Program Sealift Command Program saw Flag removed time paid these charter Subsequently, stipend of with Overseas commenced costs during second vessels one reduce three the U.S. permit from entered and

to position, As actively formerly vessel another occupied discussed, fill are the seeking Mykonos. by to acquire we the Sam TSP

Please slide turn nine. to

$X.X drydock off-hire days to decline primary XX of year. were change. million revenues to TCE quarter from contributor $XXX.X due this was Second million, quarter first the schedules the

activity survey third increased will of quarter. in We see to continue the impact

days will have drydock XX occur We the of third in quarter. days which second XXX budgeted half, in the

We related expect to balance expand EBITDA and over a discussed $XX.X from was approximately this decrease in the decrease capital $XX expenditures quarter, drydock resulting million, the principally prior small year. on from million Adjusted revenues. of the

slide to turn XX. Please

million. $X.X $X.X increased the Our daily tanker million declined and specialized average Jones revenues business revenues Act higher product million to declined ATB due revenues rates. $X.X

at Looking XX. slide

returned the levels During increased following to fully scheduled Jones Act TCE quarterly between were and by those quarter, levels. Command XX-day had tanker lightering the the historic fewer survey Sealift exceeded to as during first Alaskan Cascade's period during historical stable the voyages the and means. Overseas revenues Mykonos revenues returning quarter. business be chartered. shuttle Act revenues Overseas the quarters volumes levels influenced for Tanker tanker more to with the was $X.X reverted the Military of Non-Jones customary the continued to In volumes quarter. completion million vessels first this associated second drydock typical intermediate performance quarter,

cargos businesses operating decrease turn off-hire providing from a $XX.X rate million return increases both $XX.X reduced the tanker the contribution. period product increased the contribution contribution from as for million decreased new slide contribution $X.X first contracts the drydock due the $X.X in more to million Mykonos experienced the The to our slightly million the Handysize coupled change. specialized quarter. XX. on Please contribution levels decreased non-Jones MSC OSG impetus survey during to Act and and OSG quarter. for this Vessel million customary XXX decreased in The the lightering $X.X Jones with tankers ATBs from Act volumes XXX to for our period as

from our QX volume bringing requirements to EBITDA million lightering XX, reflects quarter increased for EBITDA EBITDA was first Turn quarter, $X.X please. a million, survey $XX.X the million by from the Adjusted reductions. slide modest decline Adjusted the to adjusted half first $X off-hire and for $XX.X days again, million.

the to our million. results. Please increased demand, net slide renewable is XX-month positive substantial markets XX. these contributing including income net and as our in substantially rate of duration in basis, to generate our We’ve improvement in resulted The $XX.X turn increases continue vessel income trailing to diesel impact contract

Please turn to slide XX.

me the columns. not two discuss published And First, slide had correct million, XXXX, apologize March of $XX At as is XX, let cash I'll the that million. incorrect $XXX slide. affects an we a information total

of quarter, and capital $XX the million and adjusted not million. $XX million we generated contribute EBITDA During used of $XX working cash

liquid invested plus $X vessel ended shares resulting $X paid and We for our million reduced costs, We We million. $XXX million investments total $XX through of $XX million other additional of amortization. drydock of cash, the million for which scheduled million million with quarter of and liquidity an debt million. outstanding repurchased in capital $XXX $X X.X in we've service, debt

discussion slide we turn $XXX liquidity, cash. as had before, XX. Please cash to million Continuing mentioned of of and our

million, a $XX.X net times. since debt XXXX. Our total outstanding decrease with Scheduled equity, equity $XXX XXXX of March X.X of million, million of debt is million to was the $XXX representing remainder is in ratio amortization $X our for indebtedness loan

is In million, of $XX.X $XX.X scheduled debt is principal XXXX, million which service our amortization.

$XX the Overseas loan our an outstanding time balance on that September Additionally, and million. XX, have in of Coast Sun at matures will

This I'd back statements. concludes on to to Sam? my Sam. the comments turn like call the financial

Samuel H. Norton

Dick. Thank you,

the rate average outset of the of contracted abilities As some of to year. for us where highlighted currently Dick's and attained positive the quarters, and in our of to result proceeded comments, now detailed ahead both Act largely and in extent volumes has lightering year MR in changes with as the our charter of of half the the for our only the a specialized we putting contribution TCE first solely visibility assets of of according experienced performance in vessels trade. by of at rates guided market on-track two conditions plan, occur With XXXX of the coverage will the expectations which non-Jones international future in balance greater

well and as over rates are remains participating changing of anticipate continuing and of and cash strength to metrics in charters Our next emerging to patterns the several fleet areas all actively profitable higher We financial time transportation sustain in is available situated fuel the respond to opportunity. shipments, in at well-positioned of balances important international today build and domestic utilization quarters in realized. engaged

with increased the Dick noted, from guidance As out full-year we results survey have of do anticipate half vessel year. confidence securing second a last drydocking quarter. of for Nevertheless, us service improving gives presented XXXX it on for improved in success of contracts, we in our this our what terms days number

for adjusted the planned for $XXX for million. service the top to calendar approximately $XX After debt we should be million. free expect $XXX now flow a line should year We capital and full-year million close maintenance anticipate charter time cash the earnings of that generate full-year XXXX. results equivalent of Attaining about full expenses, of deducting these EBITDA

existing on vessels these should of our results, and firmly focused reasonable on The specialized of extended that coverage as a allows to from growth certainty, deliver for operational well with the execution is excellence, project contract achieved in To year. of mission results into some be degree as us next also XXXX pursuit opportunities our businesses.

equivalent XXXX. for and $XXX what know EBITDA expect we the for calendar Given full charter exceed exceed $XXX we earnings of today, adjusted time year to an million million to XXXX

that of level for the is we consider with use and make between balance our most conversation must future topic means proper flow surplus allocation among shareholders. obligations regular allocation the to of the achieving capital managing decisions to Capital Board. our important be investing a payment future, towards considering a cash in returning and the We cash fixed of of our appropriate

continue investment of invest recognize of to need meet ambitious target long-term be shipping. to a to model. To goals ocean We zero future the our emissions our to responsive the achieving solutions sustainability in shareholders, for and the of business ensure objectives to of

this our we will that that assessment are can years in ahead. continue we these We made comments As reflected presentation, goals. believe the progress that month of objectives advance and hope we to meeting making good in you these all with towards during and agree

can the we for Drew, questions. up call now open

Operator

begin will the Value comes question-and-answer We with first Edge. Molins now Instructions] question Please session. go [Operator The from Climent Investor's ahead.

Climent Molins

you Good for morning. Thank questions. my taking

COX You some transport. interesting very on commentary provided

potential should phase, is about think it? event, or commitment do you this any could exploratory Could when materialize? Although think how still this an a we be firm XXXX

Samuel H. Norton

order is you opportunity just Thanks time, were or extremely context, This of magnitude able to transport, lead as volumes Act the for interesting. the to meaningful long probably a that regulations States think be it of projects new an put have in for three to of we order series that vessel project the likely area likely Jones in comply if today some in we the with of will to Climent. question, to it's a years. four a service is is delivery vessel United of time noted, to But COX

be So, if firm project to of better were today, that part in project generation three have years. to even likely hand for revenue we five from visible a would not a

facilities see, within receiving our infrastructure years, that all be think that, vessel be intermediate, that, and ground volumes of sequesters pipelines off those and my the next end. getting hopeful would Projects the and the and annual meaning transport other committed we to to we're storage on to the and actually made of of construction COX are from, ground. get commenced own off I in emitters allow to of commitments real towards, be the of will seeing two expectations understanding progress that projects

to could in XX something [Technical next, area to be revenue the long not opportunity run. difficulty] to But that significant generating that's portfolio term, our in longer So, provide it's additive it's an revenue the I think XX going of certainly

Climent Molins

helpful. with question, invest the best very on would the or That's following speak Thank one? up mostly would appetite infrastructure, online that you. to in there be And any you

Samuel H. Norton

carbon I think that question we're how think capital position competitive I to to still examine from the our that would capture, stranded that, don't deploy we ensure a can and that's perspective emitter early value sequestration the links capture chain that transportation considering. sites. distribution. attain in the emitters we question of in stage best full the with But, will most of the actual equipment of this chain that include the at think I capture sites. in But

think link. scope transportation that for there's chain and I examine, us of every value to each the in part

Climent Molins

Makes helpful. That's sense. really

You've rather I international this grand how was to but would option, slot. you And likely three you government do first slots vessel? of secured fulfill in acquire last or total a the contracts, plan most MRs. Is a on have you wondering the bareboat

Samuel H. Norton

that the perspective, is of looking from I a we'd vessel. both think But, we're as capital view at if bareboat to look point opposed we cost most life is the really opinion the own vessel structure. the options. is it My of ultimately easier at as beneficial own to which

Climent Molins

quarter. That's you you. color. the questions for congratulations for the taking all my Thank for Thank and Thanks me. for

Samuel H. Norton

My pleasure, Climent.

Operator

with Needham. ahead. The Ryan next question comes Vaughan Please from go

Ryan Vaughan

Sam, it’s numbers. you some Sam, guidance, guys Thank the Dick, thanks the hi, for hope big And, well. time are doing Great job you. in quarter. Hi,

cash year, million $X.X other a was for ton getting going Thank great it's a for, XXXX. at a things out basis. pretty, leverage to and you EBITDA a million help just you here for on about, a this look I for low at bit free year, there, So, ask us of $XXX job million if flow, could it's but on ahead that. maybe net for $XXX few little next generating you Sam Dick, especially Come

cash in With actual Can balance, the as low. it's you quite that be, thinking point Where six company? thinking an being perspective, the out balances, guys at obviously, about the bigger from but as How start like far leverage year as we're you're the what a and said, just it's you good a debt of are cycle. months, it's ideal? to talk you what's ideal about six end what's maybe to would for we toward thinking about,

Richard Trueblood

Yes.

other of arising. like clearly in then continuing see continue, to a for bit, real make think, maturing are. we in opportunities as to what we obligations there, out business investments year. and how maturities deploy cash some think, And capital to debt debt But, reduce the mix we’ll a and our I Ryan, mean, you next fixed and have what piece are I to becomes future. start I additional we deleverage some it know, our would one on XXXX, are respects, of

debt we is that be to be opportunity look But, going a outright how some adding I whether And think what a have to it's see program, TSP very now that instance, that the opportunities We on or purchase without refinancing at [indiscernible] and it's an it. for near-term for the to made repaying is, based and decision would attractive. ship unfolding implies. again, charter bareboat

in we expanding as it XX an interest have TSP XX And continue then, our to from vessels. grows that participates in the fleet to

And then at going it out. to capital well, all those balance and have we're to as so commitments look

I think evolving to it's So, be outcome. an going

Ryan Vaughan

enough. Fair

Samuel H. Norton

Yes, Ryan --

Ryan Vaughan

sorry. Oh,

Samuel H. Norton

of in three to repurchases need of terms well, areas we to we debt of the cash mindful [technical there's I of expand there's sort to There's probably investment aside bucket forward we're think one that. in business repayment about leaving opportunities probably Ryan, maybe going when can think three need in consider be we loose and of near-term, it, our -- terms, add the in that share requirements. some difficulty]

on into implications since amount to hopeful to able in since the by mentioned, vessel of to BP used. TSP XXXX. back would an well operating Alaskan pretty condition, the replacement Dick capital for been we be whether likely second the the cash is, the Mykonos or the would an as program, then investment that that And a that it’s would involve that's obviously frontier that acquisition vessel, of purchase is, lay-up bareboat outright substantial currently which find, reactivating as that still be of as of bringing means One have owned both remain is

the So, some on there's end some the by clarity year. of hope that that we have

then consumption be And period capital in third over will ships. in investments in, that likely prepared detail of the XXXX some area, is, our I made expenditures my reduce and to Again, investments are the comments at that addressed in fuel XXXX. those

all fixed rate. how So, things how those really And evolve have note in are these them, out look debt from we all there. debt at fund is you an I there. and finance of attractive, environment where that benefit interest we specific And, rates that pretty our day-to-day. prepayment marginalized are of will when would particularly pretty loans rising, out the of real becomes we currently

pursue a I or deleveraging will either debt think, when and projects other debt, or new that being basis and and consolidated acquisition run-off, completed. they're rather projects on we else of difficulty] And, one-off those packages. our capital on business those debt that no mentioned, of then existing some deployment of through all I financing in with some more put continuing look minimum those our [technical to once amounts some of refinance more has equal, do of or amounts than

for think as just financial plan, the due in coming maturities as that Dick XX I XX into collateral with entered per those projects and with months we specific, over new some so, off the to together as may we or we continue if of series months. loans as leaving use go future a And either assets that next, collectively of projects, be we have ourselves not repay well, next or unencumbered those mentioned coming XX financing the that, things that to can

ago in It's certainly look goes opportunities. little what you to couple to clear today about of years best better it I maximize how a options a that And, of cash So, or a gives we're several think thinking use to these was we are of clearly thinking us. opportunities. our bit of the our when open description in on at terms that that than

Ryan Vaughan

for don't follow-up three one, will the say the you frontier, sense. Thanks the on, back And you year, It you number to the heard hopefully mind, the Sam. on to give what's the great, get I of if some the just you. in Approximate clarification. us that by for timing end timeline make have Thank clarity That's and water? options. then rough Alaskan perfect

Samuel H. Norton

We clearly substitute vessel the later. Mykonos for to Yes. would like sooner a get than rather

able I hope said year. Alaskan comments, frontier, achieve end a bit that as of a moving target. we this Clarity in we that months. for think some But, of that next to the year, more see the hopeful So, that my the within today will -- on by we're the our on within six next are that is movement the remains little I

And would then, invest be to vessel service. able back then it the to in need into bring we to

be we to timeline XXXX. earliest late that would current Alaskan would Our expect to now, right the the company frontier be, contributing revenue in the of

forecasting. should our next that three now about know for really to we four not featuring more it's in But months. in So, the

a order magnitude of deployed which are to of for of contracts within capital run, the And be be the over two sign will do capital an evenly the expended. we two I that starting, of total ships, cost additional will the I $XX And the end probably as cost engines If said, with there. to the million. XX-month as vessels. signed we including to days, project that to elements have mentioned, finally, next invest XX two the working B&W upgrade September. ships a of our in all MoU -- ATC period we there, And MAN capital And will do option we firm kind

Ryan Vaughan

job Sam, Great. entire Okay. right. sounds all that extra Well, the team. and to All Thank the details, you. great good. Thanks for

Operator

go Please [Joshua Private (ph) Investor] [Operator Instructions] Kehoe, comes The next question from ahead.

Unidentified Analyst

into more could that of done international, the the I rates only are, for you get And sense follow-up MSC spot want Yes. program volatile of volatile. but currently Hi, slots Sam. little a to the my the little Tankers? call. MR market, international filled. given TSP voyages bit and good of program? at My a Government understanding just rates, on more is Israel know bit the for Hi, I spot desire you TSP we enter participants Dick. it’s more the possible, taking If nine kind of, to ten of are Thank

Samuel H. Norton

question, Josh. couple observations I of that A make. the would for Thanks

think, I and four an longer from the XX to spur XX have that that ships something attractive well three the it expansion in that is is as TSP term that program next commented, to the over is to participants believe I years. -- likely program,

the the I expansion is entry alignment not of in in however, Department an into, TSP aspirations think with the and that, of short-term department the the transportation cadence something is Defense. of problematic or of somewhat

things Two contributing the One delta high high don't reflect my in existing the charter tankers opinion, time markets that MR for to in continued stand in for markets rate international tankers. prices spot international or the that expectations. the of, or price is, currently, out

announced Just I entered was full design seven into, long with methanol capable, to those in give a believe, day. delivery, for for I years, recently a $XX,XXX five an to were in time example, and of per fixed, it XXXX. engine there range of specification charters, series new believe, And buildings about ships

between day. conventional would for and $XX,XXX rates the imply vessels, per $XX,XXX that Now, charter longer more probably gap term time in

charter probably or effective that, in time of day. the based call It's eco there, international $XX,XXX, If equivalent probably $XX,XXX, let's rates. all the variability have or it we you for being tankers see, but, per certainly scrubbers lower-XXs, $XX,XXX on rest rates MR

the vis it's that, vis quite à prices returns those TSP program. at vessels the the sense, actual kind trading of generated from in any look or make to that be can you difficult trading types out of whether of market, for the when rates in internationally And

a calls to There spoken traders my an sanction to of with overhang you it available of the this in the I've to is in be opportunities its believe development. oil past. Russian moving products, the to -- mind, insensitive is there's end crude on I close in that getting about discussed and participate able and

see process that or their be that it finishes, are mean, that do fulfill levels appetite, nexus engage buying are By appetite therefore, think for buying to And that, going I that, think, to is either in I I probably completed. able for that and to to that waning price then vessel trade ships of people non-Russian once of buy to that, other anchors replace well to we maybe -- there's you'll one nine done it yet. trades, you haven't in the as I And go out and normal prices. the reasons only participate decline have haven't that, in buyers think we and maybe some the and, start that

believe, occur time for One the coming of the of -- normalization is, market in reasons the align with kind why that charter I seeing you're the themselves prices that over will rates of months. to the lag

think view a I not. guarantee Of course, beginning be that there materialize. is there process But, to out there. it may may There's no

shortage that that factor number to companies you when And will the start program. business. stress on continue Flag tremendous manning in Security continued day maritime add, of normal The other the to of U.S. every to vessels the new participating to of in vessels put our trajectory pool, I want labor, capabilities important and additional into Program the is entering emphasize of Tanker the manifests terms nearly the in of itself, which is

engaged problem of more for supporting if to the U.S. leads objectives plan sure Program a And deepen for it's logistics problem. problem. second labor, one mariners In maritime It's broaden is as for good Security a Washington manpower. first and Tanker actively requirements a I'm the And manning program the additional the not conversations with of and Congress Defense ultimately, to for sponsors this good are a it jobs. pool to, available, ramp they of for up Department. to with and to the characterize understand have. with We the of in

everybody and long-term exist, for up the and trying think and that than very that to manpower a probably I I is long understanding volatility of that the that's or short-term, MRs whatever concern, more think a run. real quickly. international teething that That's on ramp in goal, the market pains hurdles So, the board contributes

in think vessels the the the in run into availability a contributor of greater that I program. is terms short hesitancy to of putting labor more

Unidentified Analyst

and I'm to again. appetite quarter. my vessels anything makes runs more you've diesel thought It you be sense. of thank wondering response. real for interested XXXX. No. I renewable PBS, online of in guidance renewable and once I end any renewable change And had that both transportation. if the in there. mean, for of if ten involved would have seen eight mentioned I believe I'm just come because you that's or you before, eventually I quarter, Thank the doing Vertex lot the in questions. their Are like and diesel great And, really in seeing terms second quickly, And obtaining I you follow-up may a for charters thoughtful diesel, plants know you always that

Samuel H. Norton

market So, renewable there more available more tankers would for MR is, if movers appetite my diesel to those probably on take were today, renewable vessels. there in be of take diesel

and in knowledge, said fixed As I deployed. MR tanker comments, to my every is prepared currently our

there's So, vessels. of availability no

where little there's there's isn't supply a now. right to there's where because any hard it's supply and how, simply just demand So, speculate

some certainly tonnage of about the We the inquiries have of field we continue to customers from that in existing future. availability

believe that to still me leads probably that there's demand there. So

you I just Gulf developments this, online, think, California, hedge that the fuel Coast some West know, renewable you were of with low equivalent change think, of or states come in Coast post Coast credits. dynamics to trades. If -- terms I in the the a to bit, some that to and, those the fuel read little for long of carbon of comments I've that a might things West to online, transportation sorts other

but in appetite that's customers I don't the I at area next an looking terms probably term think change beyond year looking tempers think some of or in expects to our of and that, anyone contracts. the question of reasonably two, current that longer

Unidentified Analyst

Great. much. very Thank you

Operator

closing turn Sam the conference any would for session. This Norton, to, I back to concludes question-and-answer over remarks. like our

Samuel H. Norton

with certainly you, to everybody into Thank our for much. XXXX. you good continuing once thanks we look Thank you Drew. encouraged of day. And, Wishing in. balance the as business everybody, news this very the a to good listening forward and of and trajectory We're give to year through again, roll

Operator

concluded. The today's Thank now presentation. conference you for attending has

disconnect. now may You

Overseas Shipholding Group, Inc. - Ordinary Shares (OSG) 7 Aug 232023 Q2 Earnings call transcript