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Note 13 — Shipping Revenue and Other Operating Income:

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Revenue Recognition

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The majority of the Company’s contracts for pool revenues, time charter revenues, and voyage charter revenues are accounted for as lease revenue under ASC 842. The Company’s contracts with pools are short term which are cancellable with up to 90 days’ notice. As of March 31, 2026, the Company is a party to time charter out contracts with customers on three VLCCs, three Suezmaxes, one Aframax, one LR2, and six MRs with expiry dates ranging from May 2026 to April 2030. The Company’s contracts with customers for voyage charters are short term and vary in length based upon the duration of each voyage. Lease revenue for non-variable lease payments is recognized over the lease term on a straight-line basis and lease revenue for variable lease payments (e.g., demurrage) is recognized in the period in which the changes in facts and circumstances on which the variable lease payments are based occur.

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Lightering services provided by the Company’s Crude Tanker Lightering Business, voyage charter contracts that do not meet the definition of a lease, and commercial management services rendered to vessel owners participating in the VLCC and Suezmax tanker pools, (TIL and TISL), respectively, are accounted for as service revenues under ASC 606. In accordance with ASC 606, revenue is recognized when a customer obtains control of or consumes promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services.

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The following tables present the Company’s revenues from leases accounted for under ASC 842 and revenues from services accounted for under ASC 606 for the three months ended March 31, 2026 and 2025:

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Contract Balances

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The following table provides information about receivables, contract assets and contract liabilities from contracts with customers, and significant changes in contract assets and liabilities balances, associated with revenue from services accounted for under ASC 606. Balances related to revenues from leases accounted for under ASC 842 are excluded from the table below.
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We receive payments from customers based on the schedule established in our contracts. Contract assets relate to our conditional right to consideration for our completed performance obligations under contracts and decrease when the right to consideration becomes unconditional or payments are received. Contract liabilities include payments received in advance of performance under contracts and are recognized when performance under the respective contract has been completed. Deferred revenues allocated to unsatisfied performance obligations will be recognized over time as the services are performed.

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Performance Obligations

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All of the Company’s performance obligations are generally transferred to customers over time. The expected duration of services is less than one year. There were no material adjustments in revenues from performance obligations satisfied in previous periods recognized during the three months ended March 31, 2026 and 2025, respectively.

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Costs to Obtain or Fulfill a Contract

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As of March 31, 2026, there were no unamortized deferred costs of obtaining or fulfilling a contract.

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European Union’s Emissions Trading System

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The European Union’s Emissions Trading System (“EU ETS”) emissions allowances (“EUA”) are valued based upon a market approach utilizing prices published on an EUA market index. The value of the EUAs to be provided to the Company pursuant to the terms of its agreements with the charterers of its vessels and the commercial pools in which it participates is included in shipping revenues in the condensed consolidated statements of operations. The value of the EUA obligations incurred by the Company under the EU ETS while its vessels are on-hire is included in voyage expenses, or in vessel expenses while its vessels are off-hire, in the condensed consolidated statements of operations.

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Any EUAs held by the Company are intended to be used to settle its EUA obligations and are accounted for as intangible assets. As of March 31, 2026, the value of EUAs held by the Company that are required to be surrendered to the EU authorities in September 2026 is approximately $2.1 million and is included in other current assets in the condensed consolidated balance sheet.

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The following table presents the components of the non-cash revenues and expenses recognized for EUAs earned and incurred during the three months ended March 31, 2026 and 2025:

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The value of EUAs due to the Company from its charterers or commercial pools in which it participates is $12.1 million as of March 31, 2026 and is included in other receivables in the condensed consolidated balance sheet. The value of the EUAs the Company is obligated to surrender to the EU authorities was $14.1 million and $9.7 million as of March 31, 2026 and December 31, 2025, respectively. The current portion of the March 31, 2026 balance totaling $9.7 million is included in other current liabilities and the noncurrent portion of $4.4 million is included in other liabilities in the condensed consolidated balance sheet.