Seatrade TANKER INDUSTRY Conference Singapore 28 April 2010 Peter M Swift, MD INTERTANKO

Oil price and freight rate – real and nominal $ per barrel

Accidental oil pollution from tankers 1000 ts spilt 1000 bn tonne miles trade Based on ITOPF/Fearnleys

Tanker Incidents and accidental pollution Number incidents ‘0000 ts pollution Based on data from LMIU, ITOPF + others

Tanker incidents by cause 2009 Based on data from ITOPF

Tanker hull & machinery incidents Number incidents Year <10 years 10-24 years >25 years Total Average age 2002 4 3 15 22 17.5 2003 8 14 18.4 2004 2 7 11 18.0 2005 9 5 20 34 17.6 2006 12 17 32 14.3 2007 25 48 13.2 2008 10 24 59 15.6 2009 13 53 16.7 2010* 6 89 45 143 287 2010 is for 110 days Based on data from LMIU, ITOPF + others

Investment in New Tonnage - Move to Double Hulls More than USD 500 billion invested since 2000 with the result that ~95% of tanker fleet* double hulled by end 2010 * over 10,000 dwt

Average age tanker fleet above 10,000 dwt Years Based on LRFairplay

SH trading beyond 2010 ? Bahamas Yes Australia No Barbados Yes Flag/Port State positions re MARPOL 13G trading up to the age of 25 years Bahamas Yes Barbados Yes Liberia Yes Marshall Isl. Yes Panama Flag Yes Japan Yes Singapore Yes India Yes Hong Kong Yes** (** Max. 20 years old) Australia No China No EU No Mexico No Romania No S Korea No* Philippines No* UAE No* (*No official note sent to IMO yet) Notes 1. Naturally understands the concerns associated with and threats posed by oil transportation, with the reminder that the accidental pollution and incident records have shown very considerable and sustained improvements for more than 10 years. 2. Stresses the imperative that all involved maintain strict adherence to international (maritime) law and review processes. 3. Advocates the conducting and completion of an impartial, comprehensive accident investigation. Stresses the necessity, before any new measures are proposed or introduced, for rigorous analysis and understanding of the risks and consequences involved based on sound technical grounds, and where appropriate encourages a full impact analysis of each such measure. 4. As a matter of principle, rejects unilateral and/or regional, ill-considered, (and frequently expeditious/opportunistic and reactionary) measures. 5. Reminds that shipowners receive only a very small proportion of the economic benefit from oil supply and distribution, and that the principal beneficiaries in this value chain are oil companies and traders. United States N/A (OPA90)

Shipbuilding output and forecast m cgt In general the CO2 emission has developed in line with energy consumption, which again has developed according to the population the growth in the population. Over the last years oil consumption has developed stronger that the population growth because the strong economic growth in large countries such as Russia, India and in particular China . Cos emission has also developed stronger than energy consumption because coal increased its part of energy consumption. The strong growth in seaborne trade can firstly be attributed to the strong import to China of raw materials and the strong growth in finished good from China to Europe and the US. Source: Worldyards/INTERTANKO Aug 09

Shipyard output potential - surplus Implications ? Distressed sales / lower prices Quality and standards maintained or weakened Pressure on suppliers and sub-contractors Greater customer focus & customisation and any government interventions ?

Lower Freight Rates & Fleet surpluses - All sectors Implications ? Challenge to maintain quality and standards, - e.g. maintenance, training Challenge to meet the issues of the day – e.g. including environmental challenges Potentially made even worse if new ships are of low standard ?

Working together ! GHG Studies, e.g. abatement measures, virtual arrival Piracy Tripartite – Builders/Class HNS Convention Safety issues, e.g. Lifeboats, Terminals, MSDS, Mercury in crudes

For more information, please visit: Thank you For more information, please visit: www.intertanko.com www.poseidonchallenge.com www.shippingfacts.com www.maritimefoundation.com London, Oslo. Washington, Singapore and Brussels

Seatrade TANKER INDUSTRY Conference Singapore 28 April 2010 Peter M Swift, MD INTERTANKO

VLCCs* deliveries and deletions Number In general the CO2 emission has developed in line with energy consumption, which again has developed according to the population the growth in the population. Over the last years oil consumption has developed stronger that the population growth because the strong economic growth in large countries such as Russia, India and in particular China . Cos emission has also developed stronger than energy consumption because coal increased its part of energy consumption. The strong growth in seaborne trade can firstly be attributed to the strong import to China of raw materials and the strong growth in finished good from China to Europe and the US. 1966 Idemitsu Maru, the first VLCC delivered by IHI, 206,000 dwt 1976 Seawise Giant, the largest tanker delivered by Sumitomo H.I , 564,650 dwt 1974 the largest number of VLCCs delivered, 124 1982 only one VLCC was delivered *Here VLCCs include all tankers above 200,000 dwt ** trading include short term storage, not lay-up or long term storage Source: INTERTANKO , LR Fairplay current fleet, Clarkson deliveries

Average age tanker fleet above 10,000 dwt Years Based on LRFairplay

Tanker Contracting 1996-2010 Source: Clarksons, April 2010 10 20 30 40 10 20 30 40 50 60 70 80 90 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 million deadweight Handy MR Panamax Aframax Suezmax VLCC Source: Clarksons, April 2010

Newbuilding Tanker Prices 30 60 90 120 150 180 Jan-76 Jan-78 Jan-80 Jan-82 Jan-84 Jan-86 Jan-88 Jan-90 Jan-92 Jan-94 Jan-96 Jan-98 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 $ million VLCC Suezmax Aframax Panamax MR Product Source: Clarksons, April 2010

Fleet Growth *Includes slippage, cancellation and removal ideas -5 5 10 15 20 VLCC Smax Amax Pmax MR Handy % change y-o-y 2000-2009 2009 2010 2011 *Includes slippage, cancellation and removal ideas Source: Clarksons, April 2010

Tanker Age Profile Source: Clarksons, April 2010 500 400 300 200 100 100 200 300 400 500 1970-1974 1975-1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 no of vessels Handy MR Panamax Aframax Suezmax VLCC Source: Clarksons, April 2010

Tanker Fleet Comparisons 12 6 5 9 19 38 33 21 29 13 20 69 68 73 75 58 10 30 40 50 60 70 80 VLCC Suezmax Aframax Panamax MR Handy percentage of exisiting fleet non-double hull On Order Built since 2000 Source: Clarksons, April 2010

Single Hull – Trading Status 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% VLCC Suezmax Aframax Panamax MR Handy Total Fleet % of single hull fleet Storage% Inactive% Domestic Trading% Normal Source: Clarksons, April 2010 (datasource: Clarksons/LLI)

For more information, please visit: Thank you For more information, please visit: www.intertanko.com www.poseidonchallenge.com www.shippingfacts.com www.maritimefoundation.com London, Oslo. Washington, Singapore and Brussels