International Seaways, Inc. (INSW)

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

FORWARD-LOOKING STATEMENTS

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This Quarterly Report on Form 10-Q contains forward-looking statements. Such forward-looking statements represent the Company’s reasonable expectation with respect to future events or circumstances based on various factors and are subject to various risks and uncertainties and assumptions relating to the Company’s operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors, many of which are beyond the control of the Company, that could cause the Company’s actual results to differ materially from those indicated in these statements. Undue reliance should not be placed on any forward-looking statements and consideration should be given to the following factors when reviewing any such statement. Such factors include, but are not limited to:

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The Company assumes no obligation to update or revise any forward-looking statements. 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 hereafter filed by the Company with the Securities and Exchange Commission.

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INTRODUCTION

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This Management’s Discussion and Analysis, which should be read in conjunction with our accompanying condensed consolidated financial statements and notes thereto, provides a discussion and analysis of our business, current developments, financial condition, cash flows and results of operations as of June 30, 2026 and for the three and six months ended June 30, 2026 and 2025. It is organized as follows:

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This Quarterly Report on Form 10-Q includes industry data and forecasts that we

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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INTRODUCTION

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This MD&A, which should be read in conjunction with our accompanying consolidated financial statements as set forth in Item 8, “Financial Statements and Supplementary Data,” provides a discussion and analysis of our business, current developments, financial condition, cash flows and results of operations. It is organized as follows:

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A detailed discussion of the 2024 to 2023 year-over-year changes is not included herein and can be found in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024 filed on February 27, 2025.

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GENERAL

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We are a provider of ocean transportation services for crude oil and refined petroleum products. We operate our vessels in the International Flag market. Our business includes two reportable segments: Crude Tankers and Product Carriers. For the years ended December 31, 2025 and 2024 we derived 52% and 47%, respectively, of our TCE revenues from our Crude Tankers segment. Revenues from our Product Carriers segment constituted the balance of our TCE revenues during these periods.

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As of December 31, 2025, the Company’s operating fleet consisted of 70 wholly-owned or lease financed and time chartered-in vessels aggregating 8.4 million deadweight tons (“dwt”). In addition to our operating fleet of 70 vessels, four LR1 newbuilds are scheduled for delivery to the Company between the first and third quarters of 2026, bringing the total operating and newbuild fleet to 74 vessels. Our fleet includes VLCC, Suezmax and Aframax crude tankers and LR2, LR1 and MR product carriers.

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The Company’s revenues are impacted by (i) the patterns of supply and demand for vessels of the size and design configurations owned and operated by the Company and the trades in which those vessels operate and (ii) the Company’s vessel employment strategy, which seeks to achieve an optimal mix of spot (voyage charter) and long-term (time charter) charters.

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Supply and Demand for Vessels

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The global fleet supply is affected by newbuilding deliveries and by the removal of existing vessels from service, principally through storage, recycling or conversions. Rates for the transportation of crude oil and refined petroleum products from which the Company earns a substantial majority of its revenues are determined by market forces such as the supply and demand for oil, the distance that

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cargoes must be transported, and the number of vessels expected to be available at the time such cargoes need to be transported. The demand for oil shipments is significantly affected by general U.S. domestic and international economic conditions and actual or expected supply chain disruptions and inflation, war and political instability in oil producing countries or regions, government regulations (both in the United States and internationally), levels of consumer demand, adverse weather and other conditions, which are beyond our control, that impact the levels of U.S. domestic and international production and OPEC+ exports.

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The geopolitical and macroeconomic consequences of political instability and armed conflict including the instability in Venezuela, the Russian-Ukraine war, conflicts in the Israel-Gaza region and continued hostilities in the Middle East, including those between Israel, Iran and the United States, continue to have ongoing direct and indirect repercussions on the global trade of crude oil and refined petroleum products.

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The Russian-Ukraine war has resulted in the United States, United Kingdom, and the European Union, and other countries implementing sanctions and executive orders against citizens, entities, and activities connected to Russia. Some of these sanctions and executive orders target the Russian oil sector, including a prohibition on the import of oil from Russia to the United States or the United Kingdom, and the EU's ban on Russian crude oil and petroleum products, which took effect in December 2022 and February 2023, respectively.

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Russia’s invasion of Ukraine also led to a disruption in supply chains for crude oil and refined petroleum products, changing volumes and trade routes, thus increasing ton-mile demand for the seaborne transportation of both crude oil and refined petroleum products, which has resulted in a prolonged spike in freight rates. Self-sanctioning by Western oil majors and many shipowners resulted in disrupted product flows, primarily diesel, from Russia to Europe, while high arbitrage spreads incentivized Middle Eastern and U.S. diesel flows to Europe, increasing ton-mile demand for vessels.

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The U.S., EU nations and other countries could impose wider sanctions and take other actions. Further sanctions imposed or actions taken by the U.S., EU nations or other countries, and retaliatory measures by Russia in response, could lead to increased volatility in global oil demand, which could have a material impact on our business, results of operations and financial condition. In addition, it is possible that third parties with which we do business may be impacted by events in Russia and Ukraine, which could adversely affect us.

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Military hostilities in the Middle East, including those in the Israel-Gaza region and those between Israel, Iran, the Houthis of Yemen and the United States have had both a direct and an indirect impact on the transportation of crude oil and refined petroleum products through the region. Heightened security risks because of attacks and threats of attacks on merchant vessels transiting through the region led to an increase in ton-mile demand for vessels as more vessel owners were opting to re-route their vessels around the Cape of Good Hope. Such hostilities also led to periodic increases in charter rates to compensate vessel owners for the heightened risks as well as increases in war risk insurance premiums.

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The United States’ naval blockade of oil exports from Venezuela on sanctioned vessels has also resulted in a shift of trade from sanctioned vessels to unsanctioned vessels as the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) has recently expanded its issuance of licenses, which authorize various oil trading activities involving Venezuela (including transportation).

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See Item 1A, Risk Factors – Terrorist attacks and international hostilities and instability can affect the tanker industry, which could adversely affect INSW’s business.

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Vessel Employment Strategy

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The Company’s revenues are also affected by its vessel employment strategy, which seeks to achieve the optimal mix of spot (voyage charter) and long-term (time or bareboat charter) charters. Because shipping revenues and voyage expenses are significantly affected by the mix between voyage charters and time charters, the Company measures the performance of its fleet of vessels based on TCE revenues. Management makes economic decisions based on anticipated TCE rates and evaluates financial performance based on TCE rates achieved.

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Our revenues are derived predominantly from spot market voyage charters and our vessels are predominantly employed in the spot market via market-leading commercial pools. We derived approximately 82% and 86% of our total TCE revenues in the spot market for the years ended December 31, 2025 and 2024, respectively. The future minimum revenues, before reduction for brokerage

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commissions, expected to be received on non-cancelable time charters for three VLCCs, two Suezmaxes, one Aframax, one LR2 and six MRs as of December 31, 2025 are as follows:

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See Item 1, “Business — Fleet Operations,” for further information on our vessel employment strategy.

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OPERATIONS AND OIL TANKER MARKETS

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The International Energy Agency (“IEA”) estimates global oil consumption for the fourth quarter of 2025 at 105.1 million barrels per day (“b/d”), up 0.8% from the same quarter in 2024. The estimate for global oil consumption for 2026 is 105.0 million b/d, an increase of 1.0% over the 2025 estimate of 104.0 million b/d. OECD demand in 2026 is estimated to increase by 0.2% to 45.8 million b/d, while non-OECD demand is estimated to increase by 1.5% to 59.2 million b/d.

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Global oil production in the fourth quarter of 2025 was 107.2 million b/d, an increase of 4.1 million b/d from the fourth quarter of 2024. OPEC crude oil production averaged 28.5 million b/d in the fourth quarter of 2025, up 0.6 million b/d from the third quarter of 2025, and an increase of 1.8 million b/d from the fourth quarter of 2024. Non-OPEC production increased by 2.1 million b/d to 73.0 million b/d in the fourth quarter of 2025 compared with the fourth quarter of 2024. Oil production in the U.S. of 13.9 million b/d in the fourth quarter of 2025 increased by 1.2% from the third quarter of 2025 and by 2.5% from the fourth quarter of 2024.

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U.S. refinery throughput decreased by 1.4 million b/d to 16.0 million b/d in the fourth quarter of 2025 compared with the third quarter of 2025.

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U.S. crude oil impo

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