Overseas Shipholding Group, Inc.

1
Overseas Shipholding Group, Inc.
Morten Arntzen, President CEO

• Oslo Shipping Forum 2007The Markets Predicting
  the Unpredictable

2
The Burden of History Remember the 70s?
1966
The first VLCC delivers
1967
The Suez Canal closes freight rates high
TAP line from Saudi Arabia to the Med.
interrupted in SyriaTanker rates jump to all
time high of 450,000/day
1970
1973
- World VLCC fleet of 366, order book 525 (160
of fleet)- Newbuilding prices 40-60
(40M-100M)- Yom Kippur war- Arab oil
embargo- Oil prices rise from 3 to 5 to 11-
Bunkers rise from 20/MT to 70/MT- Recession
hits the West- Consumption declines by 8- Oil
shipped by sea falls 30 over next decade
1974
Tankers in crisis 100 VLCCs to be deliveredNew
fields in West come on stream resulting in demand
for smaller tankers.
3
A Brief Comparison
1973-1974
2006-2007
Supply
Demand
Costs
4
Is it Different This Time?
Long-term
Short-term

• Increased FPSO conversions
• More dry bulk conversions
• When 80 and 90 of the VLCC fleet is double
  hull, who will step up and take the remaining
  singles?
• Shipyard order books getting longer, fuller and
  more expensive
• No oil spills in the next 3 years?
• Changing trading patterns

• 10-12 VLCCs being converted to dry bulk
• 12 VLCCs/ULCCs in storage in the U.S. Gulf
• 5-7 VLCCs leaving fleet for FPSO conversion in
  1H07
• Hurricanes?
• OPEC production increases 2H07
• 75K/day FFA market for VLCC 4Q07

5
China Cargoes 2000 - 2006
6
Strong Market Forecast in Crude Sector
Change in Available Tonnage
Tonne-mile Demand Outlook

• Strong rate environment forecast in 2007 / 2008
  as changes in tonne-mile and supply are about
  equal
• Rates under pressure in 2009 as supply increases
  by over 10 and demand declines as China sources
  more pipeline crude from Russia
• Demand increases in 2010 / 2011 as additional
  refining capacity comes on-stream in U.S. and
  Asia requiring long-haul movements
• Rate environment in 2010 / 2011 improves as
  demand significantly exceeds supply change

7
Product Supply Routes Going Global
Change in Available MR Tonnage
Tonne-mile Demand Outlook

• Trans-Atlantic product trade in 2007 / 2008
  include additional movements from Europe to
  Mexico and West Africa
• Supply exceeds demand in 2008 but a significant
  veg-oil market is emerging with longer movements
  strengthening MR rate outlook
• U.S. product demand in 2008 / 2009 primarily met
  by imports 2009 includes start-up of export
  refinery in India with additional intra-Asian
  movements and additional trans-Atlantic product
  exports from Russia
• Product distance increases by 11 in 2006 to 2011
  as refineries are placed further away from demand
  centers

8
Jones Act Fleet Forecast
Wilson Gillette Projection
9
Opportunity for Sector Revaluation?
EV/EBITDA (trailing 12 months)
10
The Value of OSG
100/share reflects true value of OSG
1.6B
265M
1.6B
265M1
104M1
104M
286M
851M
3.4B
3.3B
U.S.632M/19
2.5B
Products700M/21
Crude2.1B/60
NPV of Covered Chartered-ins
NPV of Uncovered Chartered-ins1
Total Value of OSG
Market Cap6/11/07
SteelValue
Cash Equiv.
Equity in JVs
Total Debt
1 As of 3/31/07 using 10-year average historical
rates
11
Return Volatility
Average Total Vessel Returns 1997-2006
Total Vessel Return (Operating Income End
Vessel Value)-Beg Vessel Value/Beg Vessel Value
12
Industry EV/EBITDA Multiples
OSG trades significantly below industry average
EV/EBITDA multiple each multiple turn represents
more than 15 per share.
OSG trades at a 49 discount to Industry Average
EV/EBITDA
9.5
4,807
P/S 118.04
4,301
8.5
M
3,795
7.5
3515
3,415
8.5
Value Gap of up to 49
2,909
7.5
OSG Multiple of 6.5 - 7

Analyst Consensus on OSGs 2007E EBITDA,
Based on 33.22 million shares outstanding
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Total Return Performance
Shipping Peer Group - Last 5 Years
FRO 694
OMM 609
TNP 394
OSG 335
TK 294
GMR 227
Source Merrill Lynch (Fact Set as of May 2007).
14
Distributable Free Cash Flow Yield
2007 Shipping Peer Group Total Capital Return
Payout Ratio averages 207
Source Merrill Lynch (Fact Set, Wall Street
research and SEC Filings as of May 2007.) 1332M
represents the shares bought back by OSG from
Archer Daniels Midland 4/24/07.
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3 ½ Years of Value Creation at OSG

• Dramatic Growth of Assets Under Management
• Total fleet grows to 149 vessels from 53
• Capital-efficient growth 53 owned versus 47
  chartered-in
• Newbuild program grows to 43 vessels from 1
• Diversification of Vessel Portfolio
• Crude, Products, U.S. Flag and Gas
• Expanded Commercial Footprint
• Premium spot earnings generated through
  commercial pools and control of cargos
• Investments in Sectors with Greater Earnings
  Stability
• 1.4B of locked-in, future revenue, predominantly
  in U.S. and Product segments
• Strict investment guidelines
• Active Management of Asset Portfolio
• Total proceeds of 1.2 billion since Jan-2005
• Disposition of non core tonnage (14 vessels,
  total proceeds 395M)
• Sales/leasebacks (18 vessels, 855M)
• Active Program of Cash Distribution
• 415M shares, or 16 of outstanding stock,
  repurchased in last 12 months
• New 200M share repurchase program announced in
  April
• Dividend increased 79 2006 to 2007

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• www.osg.com