TEN CEO: Shadow Fleet Crunch Has Pushed Tanker Rates to Rare Levels

As geopolitical turmoil reshapes global energy trade routes and sanctions pull nearly a third of the world’s tanker fleet into shadow operations, a severe shortage of high-quality tonnage has sent charter rates soaring to levels rarely seen in the industry’s history.

Dr. Nikos Tsakos, Founder and CEO of Tsakos Energy Navigation Ltd (TEN), described the current environment as unprecedented during a recent Capital Link corporate presentation. “The past five years have been the most turbulent and challenging period in the company’s history,” he said, reflecting on the succession of crises that have battered the sector since 2020.

“COVID significantly reduced oil demand and overall energy consumption. On top of that, the war in Ukraine fundamentally reshaped the map of global energy transportation, introducing new trade routes that did not previously exist,” Dr. Tsakos explained. He added that escalating tariffs, ongoing instability in the Middle East, developments in Venezuela, and persistent turmoil in Iran have further compounded market uncertainty. “Virtually everywhere oil is produced, geopolitical events are unfolding on an almost weekly basis.”

Yet for operators like TEN, which trades exclusively with blue-chip oil majors including ExxonMobil, Equinor, Shell, Chevron, Total, and BP, these disruptions have created windfall opportunities. Nearly 30% of the global fleet has shifted into so-called gray and black trading zones due to sanctions, creating a significant supply gap for vessels that meet the stringent operational and safety standards demanded by major energy companies.

“The market has gone from strength to strength,” Dr. Tsakos observed. “VLCCs are exceeding $100,000 per day compared with around $50,000 last year, which was already considered a strong market.”

Aggressive Fleet Renewal Amid Chaos

Rather than retreat during the volatility, TEN has executed one of the most aggressive fleet renewal programs in its 32-year history. The company has divested 17 older vessels and taken delivery of 33 modern ones, nearly doubling the fleet size, tripling its deadweight capacity, and materially reducing the fleet’s average age.

A key driver of this expansion has been the shuttle tanker segment, which Dr. Tsakos described as “one of the most demanding, high-end, and value intensive areas of the industry from an operational standpoint.” He noted that TEN’s Naval Academy is one of only two globally accredited to issue DP shuttle tanker diplomas.

George Saroglou, President and COO, announced that TEN was awarded one of the largest ever contracts by Petrobras in Brazil, covering nine newbuild DP2 vessels. Deliveries are already underway, with additional vessels scheduled to be delivered on a quarterly basis through 2028.

The company now operates a diversified energy fleet of 82 vessels, including DP-2 shuttle tankers, VLCCs, product tankers, and LNG carriers, with additional newbuildings underway, totaling approximately 11 million deadweight tons.

Conservative Strategy in a Strong Market

Despite the market strength, TEN has maintained its characteristically conservative financial approach. Leverage, measured by debt-to-equity, has never exceeded 50% and currently sits well below that threshold. The company has paid dividends continuously since its 1993 founding, with the current dividend set at $1.00 per share for 2025.

“We have been paying dividends since inception. We have never stopped,” Dr. Tsakos emphasized. Half of the dividend was paid in December 2025, with the remainder scheduled for February 19, 2026.

Management has made clear that dividends will continue uninterrupted, while no share buybacks are currently planned. Dr. Tsakos also pointed to the company’s readiness to divest some first-generation vessels, should market conditions warrant, to generate additional cash for further shareholder returns.

Harrys Kosmatos, Co-CFO, explained that the company’s employment model balances risk through a mix of fixed-rate time charters, time charters with profit-sharing mechanisms, and spot market trading. “The rationale behind this structure is to ensure that, irrespective of global market conditions, the fleet will consistently generate sufficient revenue to cover its full operating cost base,” he said.

Structural Tailwinds Support Multi-Year Runway

Looking ahead, management sees a confluence of structural factors supporting elevated rates for years to come. Kosmatos noted that global oil demand is at record levels, while the orderbook for new tanker deliveries remains subdued at about 14% of the existing fleet.

“Vessels over 15 years of age will exit the fleet one way or another over the next 2 to 3 years, and they will need to be replaced. The new buildings are not enough. This imbalance points to a runway of at least two to three years of healthy market conditions,” he concluded.

Dr. Tsakos also suggested that regulatory ambiguity around the IMO’s decarbonization framework has contributed to hesitation across the industry and kept newbuilding orders firmly in check. “I know people consider us too conservative, but that is precisely why we’re still around after 32 years,” he remarked.

On the demand side, Europe’s shift away from Russian energy has massively increased ton-mile demand. Voyages that previously took 2 to 3 days from Russia now require roughly twice the distance when sourced from West Africa, three times the distance from the U.S. Gulf, and potentially similar extensions from Venezuela.

Dr. Tsakos noted that there is huge appetite among major oil companies to secure tonnage over the next 18 months amid rising geopolitical tensions, and that any escalation involving Iran would have a profound impact on global trade flows, significantly reshaping export routes to Western markets.

About TEN Ltd.

Founded in 1993 and celebrating 32 years as a public company, TEN is one of the first and most established public shipping companies in the world, operating a diversified energy fleet that has made it a carrier of choice for the world’s leading energy majors.

Capital Link 2026 Corporate Presentation Series – TEN Ltd.

In this episode of Capital Link’s 2026 Corporate Presentation Series, Tsakos Energy Navigation Ltd (TEN) ‘s senior management team discussed the company’s history, recent milestones, and strategic initiatives, including fleet renewal and the securing of major contracts amid challenging market conditions.

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