<PAGE>

             BEING FILED PURSUANT TO RULE 901 (D) OF REGULATION S-T


                                    FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549


            (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF
                    THE SECURITIES AND EXCHANGE ACT OF 1934.

                For the quarterly period ended SEPTEMBER 30, 1996

                                       OR

             ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D)
                   OF THE SECURITIES AND EXCHANGE ACT OF 1934.

                             For the period from to

                             COMMISSION FILE NUMBER

                                     2-87930



                                    OMI CORP.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                   DELAWARE                      13-2625280

        (State or other jurisdiction           (I.R.S. Employer
        incorporation or organization)         Identification No.)

      90 PARK AVENUE, NEW YORK, N.Y.               10016
--------------------------------------------------------------------------------
          (Address of principal                   (Zip Code)
           executive offices)

Registrant's telephone number, including area code  (212) 986-1960

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the  Securities  and Exchange Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

               Yes    [X]       No

INDICATE THE NUMBER OF SHARES  OUTSTANDING  OF EACH OF THE  ISSUER'S CLASSES OF
COMMON STOCK, AS OF NOVEMBER 13, 1996:

            Common Stock, par value 0.50 per share 31,150,515 shares
<PAGE>




                           OMI CORP. AND SUBSIDIARIES
                                      INDEX


PART I:   FINANCIAL INFORMATION                                            PAGE

ITEM 1.   FINANCIAL STATEMENTS

            Condensed Consolidated Statements of
              Operations for the three and nine months
           ended September 30, 1996 and 1995                                  3

            Condensed Consolidated Balance Sheets-
           September 30, 1996 and December 31,1995                            4

            Consolidated Statement of Changes in
              Stockholders' Equity for the nine months
           ended September 30, 1996                                           5

            Consolidated Statements of Cash Flows for the nine
          months ended September 30, 1996 and 1995                            6

            Notes to Condensed Consolidated Financial
           Statements                                                         7

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
           FINANCIAL CONDITION AND RESULTS OF OPERATIONS                     10


PART II:  OTHER INFORMATION                                                  18

SIGNATURES                                                                   19










                                      -2-





<PAGE>


<TABLE>
<CAPTION>



                           OMI CORP. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                   (UNAUDITED)

                                                      FOR THE THREE MONTHS       FOR THE NINE  MONTHS
                                                      ENDED SEPTEMBER 30,         ENDED SEPTEMBER 30,

                                                    1996            1995         1996            1995
                                                    ----            ----         ----            ----
<S>                                                 <C>           <C>            <C>            <C>
Revenues:
  Voyage revenues                                  $ 55,952      $ 59,655      $ 175,446       $ 175,924
  Other income                                        2,647         1,476          6,273           4,360
                                                     ------        ------        -------         -------
    Total revenues                                   58,599        61,131        181,719         180,284
                                                     ------        ------        -------         -------
Operating Expenses:
  Vessel and voyage                                  40,711        51,937        130,574         153,971
  Depreciation and amortization                       7,571         8,878         23,818          26,070
  Operating lease                                        --           826            755           3,789
  General and administrative                          4,096         3,240         11,425          10,953
                                                     ------        ------        -------         -------
    Total operating expenses                         52,378        64,881        166,572         194,783
                                                     ------        ------        -------         -------
Operating income (loss)                               6,221        (3,750)        15,147         (14,499)
                                                     ------        ------        -------         -------
Other income (expense):
  Gain (loss) on disposal of
   assets-net                                         9,232           531         12,833           6,766
  Interest expense-net                               (6,866)       (5,756)       (20,009)        (18,460)
  Minority interest in (income)
    loss of subsidiary                               (1,194)           78         (1,287)            197
  Other-net                                              --            --             --             883
                                                      ------        ------        -------         ------
    Net other income (expense)                        1,172        (5,147)        (8,463)        (10,614)
                                                     ------        ------        -------        --------

Income (loss) before income taxes,
  equity in operations of joint
  ventures and extraordinary loss                     7,393        (8,897)         6,684         (25,113)
Provision (benefit) for income
  taxes                                               2,395        (3,101)         1,833          (8,296)
                                                     ------        ------        -------         --------
Income (loss) before equity in
  operations of joint ventures
  and extraordinary loss                              4,998        (5,796)         4,851         (16,817)
Equity in income of operations of
  joint ventures                                         70           894          1,136           5,493
                                                     ------        ------        -------        --------
Income (loss) before extraordinary
  loss                                                5,068        (4,902)         5,987         (11,324)
Extraordinary loss, net of tax                       (3,022)         --           (2,661)             --
                                                     ------        ------        -------        --------
Net income (loss)                                  $  2,046      $ (4,902)     $   3,326       $ (11,324)
                                                     ======        ======        =======       ========= 


Earnings (loss) per common share:
  Income (loss) before extraordinary
    loss                                           $   0.16      $  (0.16)     $    0.19        $   (0.37)
  Extraordinary loss-net of tax                       (0.10)         --            (0.08)              --
                                                     ------        ------        -------         --------
  Net income (loss)                                $   0.06      $  (0.16)     $    0.11        $   (0.37)
                                                     ======        ======        =======        ========= 

Weighted average number of shares
 of common stock outstanding                         31,558        30,927         31,420           30,658
                                                     ======        ======        =======        ========= 
</TABLE>




See notes to condensed consolidated financial statements.



                                      -3-


<PAGE>

<TABLE>
<CAPTION>




                           OMI CORP. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
                                                          SEPTEMBER 30,       DECEMBER 31,
                                                             1996                1995
                                                        -------------         ---------
                                                        (UNAUDITED)
<S>                                                     <C>                   <C>       
ASSETS
Current assets:
 Cash, including cash equivalents: 1996-
  $25,756, 1995-$26,008                                 $   44,682            $   32,569
 Advances to masters                                         2,338                 2,033
 Receivables:
   Traffic                                                   9,152                12,016
   Other                                                    15,529                 9,333
 Income tax refund receivable                                5,651                 5,651
 Prepaid expenses and other current assets                   2,342                 5,937
 Vessel held for sale                                        2,574                14,668
                                                          --------              -------- 
     Total current assets                                   82,268                82,207
                                                          --------              -------- 
Capital Construction and other restricted
 funds                                                      10,074                 9,765

Vessels and other property, at cost                        515,044               646,135
Less accumulated depreciation                             (216,860)             (277,694)
                                                          --------              -------- 
Vessels and other property-net                             298,184               368,441
                                                          --------              -------- 

Investments in, and advances to joint ventures              88,708                84,915

Cash held in escrow                                         25,527                 1,830

Other assets and deferred charges                           14,385                18,328
                                                          --------              -------- 
Total                                                   $  519,146            $  565,486
                                                          ========              ======== 

LIABILITIES AND STOCKHOLDERS' EQUITY
  Current liabilities:
  Accounts payable                                      $    8,786             $   5,187
  Accrued liabilities:
    Voyage and vessel                                       19,518                24,548
    Interest                                                 4,276                 4,375
    Lease termination costs                                    -                  22,000
    Other                                                    4,042                 4,169
  Current portion of long-term debt                         20,973                24,582
                                                          --------              -------- 
     Total current liabilities                              57,595                84,861
                                                          --------              -------- 

Long-term debt                                             238,307               259,284

Deferred income taxes payable                               63,435                63,082

Advance time charter revenues and other
 liabilities                                                 6,860                10,470

Minority interest in subsidiary                              3,662                 2,594

Stockholders' equity                                       149,287               145,195
                                                          --------              -------- 
Total                                                   $  519,146            $  565,486
                                                          ========              ======== 
</TABLE>


See notes to condensed consolidated financial statements.



                                      -4-

<PAGE>



                           OMI CORP. AND SUBSIDIARIES
            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                  FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996
                                   (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>


                                                                                            Unrealized
                                                                              Unearned     Gain (Loss)
                                                               Cumulative   Compensation       on                       Total
                        Common Stock      Capital    Retained  Translation   Restricted    Securities    Treasury   Stockholders'
                      Shares    Amount    Surplus    Deficit    Adjustment      Stock         -Net        Stock         Equity
                      ------    ------    -------    -------    ----------      -----         ----        -----         ------
<S>                  <C>      <C>       <C>         <C>         <C>           <C>          <C>          <C>          <C>        
Balance at 
January 1, 1996       31,042   $ 15,521  $ 131,622  $ (5,265)   $   4,912     $  (1,404)   $     29     $  (220)     $   145,195

Net income                                             3,326                                                               3,326
Common stock issued      108         54        508                                                                           562
Amortization of unearned
   compensation                                                                     294                                      294
Net change in valuation
   account                                                                                      (90)                         (90)
                       ------   --------  ---------  --------    ---------     ---------    --------     -------      -----------

Balance at
 September 30, 1996   31,150   $ 15,575  $ 132,130  $ (1,939)     $  4,912    $  (1,110)  $     (61)    $  (220)     $   149,287
                      ======   ========  =========  ========      ========    =========   =========     =======      ===========


</TABLE>


See notes to condensed consolidated financial statements.




                                      -5-


<PAGE>

<TABLE>
<CAPTION>


                           OMI CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

                                                                         FOR THE NINE MONTHS
                                                                         ENDED SEPTEMBER 30,
                                                                         1996          1995
                                                                         ----          ----
<S>                                                                  <C>           <C>        
CASH FLOWS (USED)PROVIDED BY OPERATING ACTIVITIES:
  Net income (loss)                                                  $    3,326     $  (11,324)

  Adjustments  to  reconcile  net income 
   (loss) to net cash (used)  provided by
    operating activities:
      Deferred income taxes                                               1,833         (8,296)
      Depreciation and amortization                                      23,818         26,070
      Amortization of unearned compensation                                 294            693
      Gain on disposal of assets-net                                    (12,833)        (6,817)
      Other - net                                                            --           (883)
      Extraordinary loss - net of tax                                     2,661             --
      Equity in operations of joint ventures
        over dividends received                                            (768)        (3,754)
      Changes in assets and liabilities:
       Receivables and other current assets                                 (41)         2,810
       Accounts payable and accrued liabilities                         (23,110)         1,165
       Advances (to) from joint ventures - net                           (3,025)         2,912
       Other assets and deferred charges                                (12,196)         1,773
       Advance time charter revenues and other
        liabilities                                                        (694)        (2,883)
       Other assets and liabilities - net                                   375            688
                                                                       --------        ------- 
Net cash (used) provided by operating activities                        (20,360)         2,154
                                                                       --------        ------- 

CASH FLOWS PROVIDED BY INVESTING ACTIVITIES:
 Additions to vessels and other property                                (14,909)       (19,804)
 Proceeds/payments from sale of marketable securities                     1,079         14,867
 Proceeds from disposal of assets                                        57,839          8,763
 Proceeds and interest received and reinvested in the
   Capital Construction and other restricted funds                         (476)          (424)
 Withdrawals from Capital Construction and other
   restricted funds                                                          --          5,200
                                                                       --------        ------- 
Net cash provided by investing activities                                43,533          8,602
                                                                       --------        ------- 

CASH FLOWS (USED) PROVIDED BY FINANCING ACTIVITIES:
 Net proceeds from issuance of common stock                                 541          1,260
 Proceeds from issuance of long-term debt                               173,923          9,000
 Payments on long-term debt                                            (185,524)       (23,870)
                                                                       --------        ------- 
Net cash used by financing activities                                   (11,060)       (13,610)
                                                                       --------        ------- 

Net increase (decrease) in cash and cash equivalents                     12,113         (2,854)
Cash and cash equivalents at beginning of period                         32,569         31,797
                                                                       --------        ------- 
Cash and cash equivalents at end of period                           $   44,682     $   28,943
                                                                       ========        =======
</TABLE>



See notes to condensed consolidated financial statements.



                                      -6-

<PAGE>



                           OMI CORP. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



NOTE 1

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include all  information  and  footnotes  necessary for a fair  presentation  of
financial  position,  results of operations  and cash flows in  conformity  with
generally  accepted  accounting  principles.  However,  in  the  opinion  of the
management  of  OMI  Corp.  and  subsidiaries  ("OMI"  or  the  "Company"),  all
adjustments  (comprising  only normal recurring  accruals)  necessary for a fair
presentation of operating results have been included in the statements.  Certain
accounts have been  reclassified in the 1995 financial  statements to conform to
their 1996 presentation.


NOTE 2 - INCOME TAXES

The  provision  (benefit)  for income  taxes for the three and nine months ended
September 30, 1996 and 1995 varies from statutory rates as follows:
<TABLE>
<CAPTION>

                                             FOR THE THREE MONTHS          FOR THE NINE MONTHS
                                              ENDED SEPTEMBER 30,          ENDED SEPTEMBER 30,
(IN THOUSANDS)                                1996         1995            1996          1995
--------------                                ----         ----            ----          ----

<S>                                        <C>           <C>            <C>           <C>     
Provision (benefit) calculated at
 statutory rates                           $ 2,612       $(2,801)       $ 2,737       $(6,867)
Adjustment for equity in operations
 of certain joint ventures                    (217)         (300)          (904)       (1,429)
                                              ----          ----           ----        ------ 
Provision (benefit)                        $ 2,395       $(3,101)       $ 1,833       $(8,296)
                                           =======       =======        =======       ======= 
</TABLE>


The  Company  has not  provided  deferred  income  taxes  on its  equity  in the
undistributed  earnings of foreign corporate joint ventures  accounted for under
the equity method other than Amazon  Transport,  Inc.  ("Amazon")  and White Sea
Holdings Ltd.  ("White Sea").  These earnings are considered by management to be
invested in the business for an indefinite period.

NOTE 3 - SUPPLEMENTAL CASH FLOW INFORMATION

Cash payments include interest of approximately  $21,599,000 and $17,482,000 for
the nine months ended September 30, 1996 and 1995,  respectively.  There were no
income taxes paid during the nine months ended  September  30, 1996 or September
30, 1995.


NOTE 4 - CREDIT LINES/LOAN AGREEMENTS

On July 12, 1996, OMI completed its cash tender offer for the purchase at par of
its  outstanding  Notes. Of the  $136,950,000  outstanding  aggregate  amount of
Notes,  $130,123,000  was  tendered  for  payment  pursuant  to  the  offer  and
$6,827,000 remain outstanding. An extraordinary loss (net of the tax benefit) of
$3,022,000  or $0.10 per share was recorded in the third  quarter  primarily for
the extinguishment of this debt.

To fund the  purchase of its Notes in  connection  with the cash  tender  offer,



                                      -7-




<PAGE>


finance  the  purchase of a vessel and  refinance  secured  indebtedness  on two
vessels and certain other indebtedness, the Company signed a $167,750,000 Credit
Agreement  ("Credit   Agreement")  in  July  1996  with  two  foreign  banks  as
co-arrangers.  This  agreement,  which matures in 18 months,  requires two equal
semi-annual  installments  of  $7,500,000  at a rate of LIBOR plus 1.75  percent
until  December  31,  1996 when the rate  increases  to LIBOR plus 2.50  percent
unless OMI has made aggregate principal repayments of at least $67,500,000 on or
before such date.  The Company has repaid an  aggregate of  $25,000,000  of such
outstanding  principal  amount as of November  15,  1996.  The Credit  Agreement
matures in January 1998 when the remaining balance is due.

The Credit  Agreement is secured by first  priority  mortgages and assignment of
earnings on 12 vessels,  second  priority  mortgages on six other  vessels and a
first  priority  pledge  of the  Company's  equity  ownership  interests  in OMI
Petrolink  Corporation  ("Petrolink"),  Amazon,  Wilomi,  Inc.  and  White  Sea.
Further, OMI's equity ownership interests in Mosaic Alliance Corp. and Geraldton
Navigation Co. Inc. may not be pledged to secure other borrowings.

The Credit Agreement imposes operating and financial restrictions on the Company
which affect, and in many respects  significantly limit or prohibit, the ability
of the Company to, among other things,  incur  additional  indebtedness,  create
liens, sell capital stock of subsidiaries or certain other assets,  make certain
investments,   engage  in  mergers  and   acquisitions,   make  certain  capital
expenditures or pay dividends.

NOTE 5 - GUARANTEED DEBT

OMI acts as a guarantor  for a portion of the debt  incurred  by joint  ventures
with  affiliates  of  two  of  its  joint  venture   partners.   Such  debt  was
approximately  $82,959,000  at  September  30,  1996,  with OMI's  share of such
guarantees being approximately $40,812,000.

The Company and its joint venture  partners  have  committed to fund any working
capital  deficiencies which may be incurred by their joint venture  investments.
At September 30, 1996, no such deficiencies have been funded.


NOTE 6 - NEWLY ISSUED ACCOUNTING STANDARD

In October 1995, the Financial  Accounting  Standards Board issued  Statement of
Financial  Accounting  Standards  (SFAS)  No.  123,  "Accounting  for  Awards of
Stock-Based  Compensation  to  Employees,"  which  was  adopted  by the  Company
effective  January  1, 1996.  SFAS No.  123  requires  expanded  disclosures  of
stock-based  compensation  arrangements  with employees and encourages (but does
not  require)  compensation  cost to be measured  based on the fair value of the
equity  instrument  awarded.  Companies are permitted,  however,  to continue to
apply APB  Opinion  No. 25  "Accounting  for Stock  Issued to  Employees"  which
recognizes  compensation  cost  based  on the  intrinsic  value  of  the  equity
instrument awarded. The Company will continue to apply APB Opinion No. 25 to its
stock based compensation  awards to employees and will disclose the required pro
forma effect on net income and earnings per share.



                                      -8-



<PAGE>



NOTE 7 - DISPOSAL AND ACQUISITION OF ASSETS

On September 30, 1996 the Company's 83% owned subsidiary,  Petrolink, sold three
supply boats for $11,600,000 in cash resulting in a gain of $9,708,000.

In August 1996, OMI received  $30,000,000 in cash for the sale of three chemical
carrier  vessels and the buyer  assumed  $34,650,000  of debt from OMI which had
been secured by mortgages on two of the vessels sold. Of the cash proceeds, 12.8
million was placed in an escrow  account  for use in  acquiring  another  vessel
which is expected to be delivered in the last quarter of 1996.

The  Company  has  entered  into a letter  of  intent  with a  shipyard  for the
construction  of two Suezmax  tankers with options for two more. The obligations
of the Company and the  shipbuilder to proceed with  construction  are dependent
upon the successful  completion of the Company's  proposed  public  Offerings of
12,000,000 shares of common stock.




















                                      -9-

<PAGE>

ITEM  2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION  AND RESULTS OF OPERATIONS
--------------------------------------------------------------------------------
OMI Corp.  ("OMI" or the  "Company")  is the second  largest,  measured  by dwt,
publicly traded shipping company headquartered in the United States and provides
seaborne  transportation services for crude oil, petroleum products and dry bulk
products  (primarily  iron  ore,  coal and  grain)  in the  tanker  and dry bulk
markets.  The  charter  rates that the Company is able to obtain for its vessels
are determined in a highly competitive  market.  Historically,  the industry has
been cyclical, experiencing significant swings in profitability and asset values
resulting from changes in the supply of and demand for vessels.

OVERVIEW

Beginning in the late 1980's, new tonnage was delivered into an improving tanker
market. At the same time, a strong tanker market discouraged  scrapping of older
vessels.  In 1992,  as a result of the  increased  supply of new  tonnage in the
tanker market combined with a global recession, tanker rates declined. Beginning
in  mid-1995,  rates in the tanker  market  have been  improving  as a result of
increased demand due to higher economic growth and low oil inventories.

Over the past several  years,  the Company has developed a strategy  designed to
capitalize  on the  strengths of OMI, the  compelling  industry  dynamics in the
international  tanker market and a competitive  advantage of operating large and
concentrated  fleets.  The Company has been  implementing  several key strategic
initiatives, including (i) refocusing its operations from the U.S. flag domestic
market  to  the   international   tanker  market;   (ii)  developing  large  and
concentrated  fleets of Suezmax  tankers and product  carriers;  (iii)  reducing
vessel  operating and corporate  overhead costs by streamlining  the U.S. fleet;
(iv) continuing its commitment to the highest quality fleet and management;  and
(v) managing the spot versus time charter mix of its vessels.

Results in past years have suffered  primarily as a result of the decline in net
voyage  revenues earned by the U.S. flag fleet,  impairment  charges for vessels
and weak  international  rate environments for tankers.  The main factor keeping
the Company from  profitable  operations  was a decline in net voyage  revenues,
which equals voyage revenues minus vessel and voyage expenses.  The reduction in
net  voyage  revenues  in past  years is  primarily  attributable  to U.S.  flag
operations.  Since 1994, U.S. flag operations have generated insufficient voyage
revenue to cover its operating  costs and  contribute to debt service.  In 1994,
losses were  compounded  by provisions  for losses for the  impairment of vessel
values and the impairment  reserve of a lease obligation.  In 1995 and 1996, the
Company sold U.S. flag assets which were not profitable and applied the proceeds
to the repayment of debt.  Consequently,  the Company will not continue to incur
losses from the  operation of these  vessels.  Interest  expense has also been a
significant factor in the Company losses.  Management intends to reduce interest
expense in the future through the  application of a portion of the proceeds of a
public offering of 12,000,000  shares of common stock to lessen debt and through
the sale of assets which are not strategic to the Company's operations.

Specifically,  U.S. results were adversely  affected by the lay up status of the
OMI COLUMBIA and unprofitable operations of the OMI HUDSON and the OMI DYNACHEM.
After being in lay up for a significant  amount of time from 1993-1995,  the OMI
COLUMBIA,  OMI's largest domestic vessel, began operating in October, 1995 under
a long-term  charter  which expires in December  2002.  In August 1996,  the OMI
HUDSON and OMI DYNACHEM were disposed of in a transaction with Hvide Marine Inc.
("Hvide").  The  Company has also  evaluated  whether it would be  benefited  by
reflagging  its operating  U.S. flag vessels and has concluded that it would not



                                      -10-






<PAGE>


be.  Existing time charters  which require U.S. flag registry,  difficulties  of
obtaining the requisite U.S. Maritime Administration  approvals and the advanced
age of the vessels make them more valuable in U.S. flag than in foreign flag.

Operating  results improved in 1996 for OMI's 83 percent owned  subsidiary,  OMI
Petrolink Corporation ("Petrolink"),  a major provider of lightering services to
tankers  importing  crude  oil  into  the Gulf of  Mexico.  In  1995,  increased
competition  in the  lightering  business  caused a decrease  in both volume and
rates which  resulted in  operating  losses.  The Company  reduced the number of
vessels it charters from six to three, renegotiated the rates paid for the ships
it charters-in  and increased  utilization  of its supply boats,  resulting in a
profit  before taxes of $11.7  million for the nine months ended  September  30,
1996.  Included in that profit is a gain of $9.7  million from the sale of three
supply boats which no longer fit Petrolink's operating strategy.

As  part of its  effort  to  return  itself  to  profitability,  management  has
developed  a program  to be  implemented  over time to reduce its  overhead  and
vessel operating costs. In 1994,  management  instituted a voluntary  separation
program which reduced staff  personnel and associated  benefit  programs and has
required  employee  contributions  to pension and health  programs.  The Company
anticipates there will be ongoing efforts to reduce administrative costs through
staff  reductions  and less  dependency  on vendors.  The  Company has  recently
negotiated  a multi-year  insurance  program for general  insurance,  which will
lessen future increases.

Vessel  operating  costs are primarily  composed of wages,  insurance and vessel
stores. Insurance premiums for vessels were recently fixed for three years which
will lessen increases in future payments.  The Company has negotiated a contract
with its union  personnel  which reduces the rate of wage  escalation  from 1996
through  1999.  The Company is currently  evaluating  programs to reduce  vessel
stores and  inventory  expense.  Operating  costs are  affected by the  vessels'
trading  patterns.  The Company  believes  its actions  have reduced the rate of
escalation in its operating costs.

The Company  operates  its tankers in markets that have  historically  exhibited
seasonal variation in demand. Typically,  rates in the tanker market increase in
the third and fourth quarters due to increases in demand for oil.

The Company has filed a registration  statement with the Securities and Exchange
Commission  relating to a proposed  concurrent U.S. and international  offerings
("Offerings") of 12,000,000 shares of its common stock.

RESULTS OF OPERATIONS

Results of  operations  of OMI include  operating  activities  of the  Company's
domestic and foreign vessels. The discussion that follows explains the Company's
operating results in terms of net voyage revenue because  fluctuations in voyage
revenues  and  expenses  occur based on the nature of a charter.  The  Company's
vessels currently operate, or have operated in prior years, on time, bareboat or
voyage  ("spot")  charters.  Each  type of  charter  denotes  a method  by which
revenues are recorded and expenses are allocated.  Under a time charter, revenue
is measured based on a daily or monthly rate and the charterer  assumes  certain
operating expenses, such as fuel and port charges. Under a bareboat charter, the
charterer  assumes all operating  expenses.  Under a voyage charter,  revenue is
calculated based on the amount of cargo carried,  most expenses are for the ship
owner's  account  and the length of the  charter is one  voyage.  Revenue may be
higher in the spot market as the owner is  responsible  for most of the costs of
the voyage.  Other factors  affecting net voyage revenue for voyage charters are
waiting time between cargoes,  port costs,  fuel price and  consumption.


                                      -11-




<PAGE>


Vessel expenses included in net voyage revenue discussed above include operating
expenses such as crew  payroll/benefits/travel,  stores expense, maintenance and
repair expense,  drydock expense,  insurance  expense and  miscellaneous  vessel
expenses.  These expenses are a function of the fleet size,  utilization  levels
for certain  expenses and  requirements  under laws, by  charterers  and Company
standards. Insurance expense varies with the overall insurance market conditions
as well as the insured's loss record, level of insurance and desired coverage.


RESULTS OF  OPERATIONS  FOR THE NINE AND THREE MONTHS ENDED  SEPTEMBER  30, 1996
VERSUS SEPTEMBER 30, 1995

VOYAGE REVENUE LESS VESSEL AND VOYAGE EXPENSES

Net voyage  revenues of $44.9  million for the nine months ended  September  30,
1996 increased $22.9 million, or 104 percent, as compared to net voyage revenues
of $22.0 million for the nine months ended  September 30, 1995. The net increase
was primarily  attributable  to the U.S. flag fleet,  which  accounted for $18.6
million of the increases.  Net increases in 1996 domestic  operations  primarily
resulted from the following:  (i)the OMI COLUMBIA is operating on a time charter
in 1996 at higher  rates with no offhire  days  compared  to 71 idle days in the
nine  months  of 1995;  (ii) two  vessels,  the  PATRIOT  and the  COURIER,  are
currently  operating on time charters with the U.S. Military Sealift Command; in
1995 these  vessels  were  offhire an  aggregate of 107 days while in drydock in
preparation  for these  long-term  charters;  (iii)  results  of  operations  of
Petrolink  improved in 1996;  (iv) the OMI STAR was purchased in June 1995, thus
eliminating  expenses of chartering-in this ship; and (v) the PLATTE earned more
revenue in 1996 due to more  operating  days in 1996 compared to 1995  (however,
the vessel has still incurred losses in 1996).

Net increases of $4.3 million or 19 percent in 1996 foreign net voyage  revenues
resulted from improved  international market conditions in the crude oil market.
Increases  in revenue  were offset,  however,  by increases in fuel  expenses as
compared  to the same  period in 1995,  and the  expense of  drydocking  a crude
carrier.

Net voyage  revenues of $15.2  million for the three months ended  September 30,
1996 increased $7.5 million or 97 percent as compared to net voyage  revenues of
$7.7 million for the three months ended  September 30, 1995. The net increase in
the domestic  fleet of $6.0 million was primarily  attributable  to the improved
operating results of Petrolink and the improved performance of the OMI COLUMBIA.
The net  increase in the foreign  fleet of $1.5  million  was due  primarily  to
higher  revenues  earned by the Suezmax  tankers than revenues in the comparable
period in 1995.

OTHER INCOME

Other income consists primarily of management fees and dividend income earned on
investments. For the nine months ended September 30, 1996, other income was $6.3
million, an increase of $1.9 million or 43 percent from $4.4 million in the nine
months ended  September 30, 1995. For the three months ended September 30, 1996,
other income was $2.6 million as compared to $1.5 million.  The increase in both
periods was primarily from additional fees received from the U.S. Government for
the  management  of ten  vessels  in 1996  versus  six  vessels  in 1995.  These
increases  were offset in part by the decrease of management  fees received from
two joint  ventures,  one of which is  currently  being  managed by OMI's  joint
venture  partner  and the other of which is now being  managed by a third  party
technical manager.


                                      -12-




<PAGE>

OTHER OPERATING EXPENSES

The Company's operating expenses, other than vessel and voyage expenses, consist
of  depreciation  and  amortization,  operating  lease  expense  and general and
administrative  expenses.  For the nine months ended  September 30, 1996,  these
expenses  decreased  an  aggregate  of $4.8  million or 12 percent from the nine
months ended  September  30, 1995.  The primary  reason for the decrease was the
reduction of the operating lease expense of $3 million after the purchase of the
OMI HUDSON from its lessor in February 1996.  Depreciation  expense decreased by
$2.3 million or 9 percent as a result of the write-down of the carrying value of
two  vessels in  December  1995 to  recognize  impairment  losses.  General  and
administrative  expense  increased by $472,000 or 4 percent to $11.4 million for
the  nine  months  ended   September  30,  1996.  This  increase  was  primarily
attributable  to a one  time  charge  by  Petrolink  of  $684,000  to  incentive
compensation as a result of the supply boat sale.

For the three months ended September 30 1996, other operating expenses decreased
$1.3 million or 10 percent.  The primary  reasons for the decrease were due to a
reduction  of  $826,000  in  operating   lease  expense  and  net  decreases  in
depreciation  expense of $1.3  million,  offset by an  increase  in general  and
administrative  expense of  $856,000,  primarily  from the charge for  incentive
compensation mentioned above.


OTHER INCOME (EXPENSE)

Other  income  (expense)  consists of gain  (loss) on  disposal  of  assets-net,
interest  expense-net,  minority  interest in (income)  loss of  subsidiary  and
other-net.  For the  nine  months  ended  September  30,  1996,  these  expenses
decreased $2.2 million, or 20 percent,  from the nine months ended September 30,
1995.  This decrease was  primarily  due to the increase of $6.1 million,  or 90
percent in gain on disposal of  assets-net.  In the third  quarter of 1996,  the
Company  recognized a gain of $9.7 million from the sale of three supply  boats.
Additionally, an aggregate of $2.7 million net gains were recognized as a result
of the sale of 5 vessels in 1996. In 1995,  2,503,389  shares of Noble  Drilling
Corporation  stock were sold for a gain of $7.8 million  which was offset by the
loss of $1.4  million  on the sale of a  foreign  vessel.  Interest  expense-net
increased by $1.5 million, or 8 percent due to the write-off of unamortized loan
fees  pertaining  to debt secured by the HUDSON and the  DYNACHEM and  financing
fees on lines of  credit.  Minority  interest  in income  (loss)  of  subsidiary
increased by $1.5 million  primarily due to Petrolink's  gain on the sale of its
supply boats.

For the three  months ended  September  30,  1996,  net other  income  (expense)
increased by $6.3  million to $1.2 million  income as compared to a $5.1 million
loss for the same period in 1995.  This was  primarily  due to the $9.7  million
gain from the sale of the  supply  boats,  offset by the  decrease  in  minority
interest of $1.3 million and an increase in interest expense of $1.1 million.

PROVISION (BENEFIT) FOR INCOME TAXES

The income tax  provision  of $1.8  million and benefit of $8.3  million for the
nine  months  ended  September  30,  1996 and 1995,  respectively,  varied  from
statutory rates primarily  because deferred taxes are not recorded for equity in
operations  of joint  ventures,  net of  dividends  declared,  other than Amazon
Transport,  Inc.  ("Amazon")  and  White Sea  Holdings,  Ltd.  ("White  Sea") as
management considers such earnings to be invested for an indefinite period.



                                      -13-

<PAGE>


EQUITY IN OPERATIONS OF JOINT VENTURES

Equity in  operations  of joint  ventures  was $1.1  million for the nine months
ended  September  30, 1996 as compared to $5.5 million for the nine months ended
September  30, 1995.  The decrease was  primarily  from the  operations of three
joint  ventures.  One 49.9 percent  owned joint  venture,  Geraldton  Navigation
Company Inc.  ("Geraldton") sold a vessel in 1995, OMI's portion of the gain was
$990,000.  Amazon,  a 49 percent owned joint venture,  operates one vessel which
was offhire due to  drydocking  an  aggregate  of 87 days during the nine months
ended September 30, 1996. Also, in June of 1996, OMI recorded a loss of $867,000
related to the sale of a vessel by Mosaic  Alliance  Corporation  ("Mosaic"),  a
49.9 percent owned joint venture.

For the third quarter of 1996, equity in operations of joint ventures of $70,000
decreased  $824,000 from  $894,000 in the third  quarter 1995.  The decrease was
primarily attributable to the operating results of Amazon.

EXTRAORDINARY LOSS

In the third quarter of 1996 the Company recorded an extraordinary  loss, net of
tax of $3.0 million,  or $.10 per share,  in connection  with the  repurchase of
$130.1 million  aggregate  principal  amount of its Senior Notes. See "Liquidity
and Capital Resources - Financing Facilities."

LIQUIDITY AND CAPITAL RESOURCES

CASH FLOWS

Cash and cash equivalents of $44.7 million at September 30, 1996 increased $12.1
million from the balance of $32.6  million at December 31, 1995.  The  Company's
working capital of $24.7 million at September 30, 1996,  increased $27.4 million
from $(2.7) million at December 31, 1995. The primary reason for the increase in
working capital is due to proceeds from the  disposition of assets,  net of debt
repaid.

For the nine  months  ended  September  30,  1996,  net cash  used by  operating
activities  was  $20.4  million  compared  to  $2.2  million  cash  provided  by
operations in the nine months ended September 30, 1995. The primary cause of the
increase  in cash used was the payment of $22 million as part of the $25 million
lease termination fee for the OMI HUDSON in the first quarter of 1996.

A component  of cash used by operating  activities  is cash used for advances to
joint ventures. Such advances,  which can be large, support operating activities
that  occur  in the  normal  course  of  business.  These  advances  are  repaid
periodically.  The Company has received  dividends  from certain joint  ventures
aggregating  $368,000 in the nine months ended  September  30, 1996 and $539,000
for the same period in 1995.  Most joint venture  earnings are  considered to be
invested for an indefinite  period and are not available for  distribution,  and
there is no  certainty  that the joint  ventures,  the earnings of which are not
considered to be indefinitely  invested,  will have  sufficient  earnings to pay
dividends  in the future.  Therefore,  the Company  cannot rely on  dividends or
loans from joint ventures to improve its liquidity.

The Company operates in a capital-intensive industry and augments cash generated
by  operating  activities  with debt and sales of vessels that no longer fit the
Company's  strategy.  For the nine months ended  September 30, 1996,  sources of
liquidity, other than from operating activities,  were primarily net proceeds of
$160.9  million from a new credit  facility,  proceeds of $29.6 million from the



                                      -14-





<PAGE>



sale of two  vessels,  and  $11.6  million  from the sale of  supply  boats.  In
addition, in August 1996, OMI received approximately $30 million in cash for the
sale of the three chemical  carrier  vessels and its interest in Ocean Specialty
Tankers Corporation ("OSTC") to Hvide. Hvide also assumed $34.7 million of debt,
which had been secured by mortgages on two of the vessels. Of the cash proceeds,
$12.8  million  was placed in an escrow  account  for use in  acquiring  another
vessel which is expected to be delivered in the last quarter of 1996.

The primary uses of cash, other than for operating activities, were for payments
of $185.5 million on long-term debt (including $143.2 million for repurchases of
Senior Notes and $24.3 million in debt prepayments for vessels disposed of), the
purchase of the OMI HUDSON for cash of $9.3  million (for which OMI also assumed
$19.6  million in  related  debt) and other  capital  expenditures  for  vessels
aggregating $5.6 million.



FINANCING FACILITIES

In July 1996, OMI repurchased  $130.1 million aggregate  principal amount of its
Senior Notes in a cash tender  offer as part of a plan to refinance  portions of
the Company's long term indebtedness in order to reduce its interest expense and
to eliminate the  restrictive  covenants in the Senior Notes. As a result of the
tender  offer,  only $6.8  million  principal  amount of the Senior Notes remain
outstanding. An extraordinary charge (net of the tax benefit) of $3.0 million or
$.10 per share was recorded in the third quarter for the extinguishment of debt.

To fund the purchase of its Senior  Notes,  finance the purchase of a vessel and
refinance  secured  indebtedness on two vessels and certain other  indebtedness,
the Company signed a $167.8  million Credit  Agreement with two foreign banks as
co-arrangers.  The Credit  Agreement  requires two repayments of $7.5 million of
principal in January 1997 and July 1997,  with the balance of the  principal due
in January 1998. The Credit  Agreement  bears interest at a rate of LIBOR plus 1
3/4 percent until  December 31, 1996 when the rate increases to LIBOR plus 2 1/2
percent  unless OMI has made  aggregate  principal  repayments of at least $67.5
million on or before  such date.  As of  November  14, 1996 the Company has made
principal  payments  of $25  million  and has an  outstanding  balance of $142.8
million.

The Credit Agreement has been secured by first priority mortgages and assignment
of earnings on 12 vessels,  second priority mortgages on six other vessels and a
first priority pledge of the Company's equity ownership  interests in Petrolink,
Amazon, Wilomi, Inc. and White Sea. Further, OMI's equity ownership interests in
Mosaic and Geraldton may not be pledged to secure other  borrowings.  The Credit
Agreement  imposes  operating  and financial  restrictions  on the Company which
affect, and in many respects significantly limit or prohibit, the ability of the
Company to, among other things,  incur  additional  indebtedness,  create liens,
sell  capital  stock of  subsidiaries  or certain  other  assets,  make  certain
investments,   engage  in  mergers  and   acquisitions,   make  certain  capital
expenditures or pay dividends.

In  addition  to  the  Credit  Agreement,  the  Company  also  has  a  revolving
credit/term loan agreement providing for up to $35 million in borrowings, all of
which was drawndown as of September 30, 1996.

The Company is required  to repay its Credit  Agreement  in full within 120 days
after the closing of its proposed Offerings of common stock. After giving effect
to the proposed  reduction in borrowings  under the Credit  Agreement  using the


                                      -15-




<PAGE>

proceeds of the public  Offerings,  the Company  will still be unable to satisfy
its repayment  obligations  under the Credit Agreement using its available cash,
and will be required to refinance the borrowings  that remain  outstanding or to
sell assets to meet its obligations.  In addition,  the Company also expects its
vessel acquisition program to require significant amounts of additional capital.
The Company has  undertaken  discussions  with its lead lenders to refinance the
Credit  Agreement on more  favorable  terms and to fund the  Company's  proposed
vessel acquisition program. While no binding commitments exist, discussions with
two leading  finance banks have  indicated that they will support the Company in
the  refinancing  of its existing  credit  facilities and the financing of a new
construction  program.  The banks have also  indicated  that the Company's  debt
reduction  program  through the sale of assets and reduction of operating  costs
will result in more  favorable  credit  terms.  While the Company  believes  the
strengthening  of its balance sheet through the proposed  Offerings will make it
possible for the Company to borrow  sufficient  capital to refinance  the Credit
Agreement  and fund its proposed  vessel  acquisition  program,  there can be no
assurance  that the  Company  will have the  ability  to borrow  the  amounts it
requires on attractive terms or at all.

The  Company  believes  that the  actions  it has taken in the last 12 months to
improve its liquidity and financial  position will,  along with the consummation
of the proposed  Offerings,  give the Company greater financial  flexibility and
permit it to borrow  sufficient  additional  capital  to  refinance  the  Credit
Agreement, fund its vessel acquisition program and finance its other cash needs.

If additional financing were not to be available, the Company could be forced to
renegotiate  the  terms  of the  Credit  Agreement  and to  curtail  its  vessel
acquisition program.

COMMITMENTS

OMI is  co-guarantor  for a portion of the debt incurred by joint  ventures with
affiliates of two its joint venture partners.  The portion of debt guaranteed by
the partners was approximately  $83.0 million, at September 30, 1996, with OMI's
share of such guarantees being approximately $40.8 million.

The Company and its joint venture  partners  have  committed to fund any working
capital deficiencies that may be incurred by their joint venture investments. At
September  30, 1996,  no such  deficiencies  have  occurred  which have required
funding.

The Company has entered  into a contract  to sell a laid-up  U.S.  flag  product
carrier to foreign interests. The sale is contingent upon approval being granted
by the U.S. Maritime Administration.

The Company and a joint  venture  partner have  committed to take  delivery of a
Suezmax  tanker in the fourth  quarter of 1996 from a shipyard  in the  People's
Republic  of China  for a cost of  approximately  $56  million.  OMI  holds a 49
percent interest in the joint venture entity.

The Company has  contracted  to acquire one 30,000 dwt product  carrier built in
1991. Delivery is expected in the fourth quarter of 1996.

The  Company  has  entered  into a letter  of  intent  with a  shipyard  for the
construction  of two Suezmaz  tankers  with  options for two more.  Each Suezmax
tanker will cost between $50 and $55 million. The obligations of the Company and
the shipbuilder to proceed with  construction  are dependent upon the successful
completion of OMI's proposed Offerings of 12,000,000 shares of common stock.




                                      -16-




<PAGE>

EFFECTS OF INFLATION

The Company does not consider  inflation to be a significant risk to the cost of
doing  business in the current or foreseeable  future.  Inflation has a moderate
impact on operating expenses, drydocking expenses and corporate overhead.























                                      -17-

<PAGE>


                                  PART II:  OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

                      None.

ITEM 2 - CHANGES IN SECURITIES

                      None.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

                      None.

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                      None.

ITEM 5 - OTHER INFORMATION

                      None.

ITEM 6 - EXHIBIT AND REPORTS ON FORM 8-K

  A.  EXHIBITS

    27 OMI Corp. - Financial Data Schedule, dated September 30, 1996.

  B.  REPORTS ON FORM 8-K

                      None















                                      -18-

<PAGE>


                                          SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                    OMI CORP.
--------------------------------------------------------------------------------
                                  (REGISTRANT)



DATE:   NOVEMBER 14, 1996               BY: /s/ Fredric S. London
       ---------------------                -----------------
                                            FREDRIC S. LONDON
                                            SENIOR VICE PRESIDENT AND
                                            CORPORATE COUNSEL


DATE:   NOVEMBER 14, 1996               BY: /s/ Kathleen Haines
        -----------------               -------------------
                                            KATHLEEN HAINES
                                            VICE PRESIDENT AND
                                            CONTROLLER
























                                      -19-


<PAGE>


                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                    OMI CORP.
--------------------------------------------------------------------------------
                                  (REGISTRANT)



DATE:   NOVEMBER 14, 1996                BY: ----------------------------
                                             FREDRIC S. LONDON
                                             SENIOR VICE PRESIDENT AND
                                             CORPORATE COUNSEL


DATE:   NOVEMBER 14, 1996                BY: -----------------------------
                                             KATHLEEN HAINES
                                             VICE PRESIDENT AND
                                             CONTROLLER















                                      -20-