Strategic Performance Drivers

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• Performance was driven by the 'One TORM' platform, which management claims provides a quantifiable advantage in reacting to spot price volatility compared to peers.

• The closure of the Strait of Hormuz created the largest oil supply disruption in history, constraining 20% of global daily oil consumption and driving unprecedented freight rates.

• Management attributes elevated margins to abnormal trade flows and structural inefficiencies that benefit both tanker companies and refining customers.

• A significant disconnect has emerged between nominal fleet growth and effective capacity due to extensive vessel sanctioning, particularly in the Aframax and LR2 segments.

• The migration of over 50 LR2 vessels into crude trading ('dirty-ups') further tightened clean petroleum product capacity by approximately 4%.

• Fleet renewal remains a core strategy, with the company acquiring younger secondhand vessels and MR resales to enhance flexibility while divesting older tonnage.

• Operational excellence is supported by a centralized management platform that coordinates decision-making and maintains higher utilization than the peer average.

Strategic Outlook and Guidance Assumptions

• Full-year 2026 TCE guidance was upgraded to USD 1.15 billion - USD 1.45 billion, reflecting exceptionally strong Q2 coverage at rates exceeding USD 70,000 per day.

• Management views current conditions as a 'structural market reset' rather than a temporary spike, expecting friction and volatility to persist even after the Strait of Hormuz reopens.

• Future performance assumes a multi-year process for rebuilding depleted global strategic and commercial inventories, supported by higher production from the UAE.

• The company is utilizing a mix of short-term spot exposure, 1-3 year time charters, and forward derivatives to capture value while maintaining operational flexibility.

• Guidance for uncovered days remains sensitive to the forward derivatives market, geopolitical developments, and potential shifts in global trade patterns.

Risk Factors and Structural Shifts

• Approximately 1 in 4 vessels in the Aframax/LR2 segment are currently under U.S., EU, or U.K. sanctions, limiting the return of older ships to the mainstream market.

• The closure of the Strait of Hormuz stranded roughly 3% of the global product tanker fleet and 6% of the crude fleet, causing significant vessel dislocation.

• Working capital increased by approximately USD 30 million during the quarter due to the combination of high freight rates and elevated bunker prices.

• Safety remains the primary operational risk, with management maintaining a 'safety-first' approach for vessels currently located inside the Persian Gulf.