- NAT is bullish on spot tanker rates because of Russia's involvement in armed conflict with Ukraine, and most of its tankers are in the spot market.
- However, Suezmax tanker rates have dropped since their spike.
- Oil demand fundamentals have softened and high oil prices are dampening demand growth expectations.
- Therefore, being heavily dependent on spot rates for future revenues is a risky proposition.
- NAT should be diversifying the timing and term structure of its charters, but it prefers to gamble, endangering future earnings.
For further details see:
Nordic American Tankers: 'F' Earnings Rating