Scorpio Tankers has transitioned to a net cash position by May 2026, marking a significant financial turnaround from a net debt of $2.9 billion at the end of 2021. The company reported gross debt of $932 million and cash exceeding $1 billion, driven by aggressive deleveraging, vessel sales, and strong spot-market earnings. This strengthened balance sheet is reducing financing costs and debt repayment obligations, according to President & Director Mr. Robert Bugbee.

Structural Market Drivers

The company's leadership believes the strength of the product tanker market extends beyond recent geopolitical crises in the Strait of Hormuz. Head of Corporate Development & IR Mr. James Doyle noted that refinery closures in Europe, Japan, Australia, and parts of the United States have increased dependence on long-haul product movements from export hubs in the Middle East, India, and Asia. Consequently, the market is now dictated by ton-miles rather than outright fuel consumption growth.

Evolving Trade Patterns

Trade pattern shifts during recent disruptions may prove permanent. Mr. Doyle highlighted that cargo volumes through the Red Sea have not recovered to previous levels despite improved security conditions. Volumes remain at 30-40% of pre-disruption levels, sustaining longer routes around the Cape of Good Hope.

Financial Metrics

Fleet and Inventory Outlook

Scorpio continues to renew its fleet, with ten newbuildings scheduled for delivery through 2029. The company is also exploring opportunities in the VLCC sector, though Mr. Bugbee cautioned that the VLCC orderbook exceeding 30% of the existing fleet could pressure vessel values. Regarding inventories, prolonged disruptions have drawn down global product stocks, potentially initiating a multi-year restocking phase constrained by fixed refinery capacity.

Scorpio Tankers Inc. announced its daily Time Charter Equivalent (TCE) rates for the second quarter of 2026 as of June 18, 2026. The update provides average daily TCE revenue and duration of contracted voyages for its LR2, MR, and Handymax vessels across pool and spot markets, time charters, and bareboat charters. The company estimates its fully diluted weighted average shares outstanding for the quarter to be between 53 and 54 million.

Second Quarter 2026 TCE Rate Update

The table below summarizes the average daily TCE revenue and expected revenue days for Scorpio Tankers' vessels in Q2 2026. The data covers vessels operating in pools and spot markets, as well as those on time charters and bareboat charters outside the pools.

TCE rates are calculated by subtracting voyage expenses, including bunkers and port charges, from vessel revenue and dividing the net amount by the number of revenue days in the period. Expected Revenue Days represent the total number of calendar days in the quarter less estimated off-hire days for repairs or drydockings. Idle days, where a vessel is available but not employed, are included in revenue days.

Diluted Shares Outstanding

Scorpio Tankers estimates its fully diluted weighted average shares outstanding for the three months ended June 30, 2026, to be between 53 and 54 million shares. This estimate includes the potentially dilutive effect of the 1.75% Convertible Senior Notes due 2031, issued in April and May 2026, and restricted shares issued under the company's equity incentive plan. The dilutive impact of the Convertible Notes is determined using the if-converted method, assuming conversion at the beginning of the period or at issuance. The calculation is preliminary and subject to change based on the average price of the company's common stock during the period. Conversion will not be assumed if the effect is anti-dilutive.

The reported rates and coverage percentages are subject to change as pool results, including estimated results of voyages in progress, are finalized. Scorpio Tankers Inc. owns 81 product tankers, comprising 31 LR2 tankers, 36 MR tankers, and 14 Handymax tankers, with an average age of 10.2 years.