Nordic American Tankers Ltd. (NYSE: NAT) addressed the following letter to shareholders:
We regularly comment on geopolitical events with relevance to the tanker market and for our 23 suezmaxes that can load one million barrels each. In particular, we commented upon the Covid-19 pandemic in press releases of January 31 and March 2, 2020.
At a time when companies are cutting back their dividend distribution, it is important for us to emphasize that dividend is a priority for NAT. We declared a dividend for 1Q 2020 of 14 cents per share payable in June this year. This is a doubling from 7 cents per share in 4Q 2019 and almost five times as high as the dividend in the first quarter of 2019 when it was 3 cents.
The tanker market is continuing from strength to strength. This bodes well for our dividends going forward. Historically, tanker rates above USD 30,000 per day are good for NAT.
OPEC and other oil exporting countries yesterday agreed cuts in oil production in the magnitude of about 10m barrels per day or about 10% of world production. We do not expect this to impact negatively the situation for NAT.
Going forward, we foresee low oil prices. This is good for our business. China, Korea and other Asian economies are recovering from the virus. Combined with stimulus packages and a low oil price, we expect that the world economy will recover. In the meantime, we are enjoying the strong position of NAT, which we expect to continue.
Please feel free to contact us on any matter about our business.
Chairman & CEO