By Swetha Gopinath and Tom Hals

Nov 14 (Reuters) - Debt-laden Overseas Shipholding Group Inc, the world's No. 2 independent tanker operator by fleet size, filed for bankruptcy protection on Wednesday as questions about its financial statements shut it out of credit markets.

The company has also suffered as the United States and other industrialized economies shift toward domestic oil supplies and away from imports, sending rates for transporting crude oil plummeting.

Many shipping companies have been forced to restructure, including Norway-listed Frontline, Italy's Deiulemar Shipping, Indonesia's Berlian Laju Tanker and Sanko Steamship in Japan.

"The tanker market has been absolutely miserable for the last eight months," Overseas Holding Chief Executive Morten Arntzen told Reuters.

He said the company was bigger than other shippers that had restructured, the bankruptcy could be more complex and the board would consider legitimate offers for its businesses. "We do have some attractive assets."

Overseas Shipholding said it had enough cash to continue operating as usual and did not require debtor-in-possession financing.

However, the company's disclosure last month that it might have to re-state results for at least three years "severely limited any access to the capital and credit markets," according to documents filed with Delaware's Bankruptcy Court.

Overseas Shipholding said in October it had uncovered a tax reporting problem stemming from the fact that it is domiciled in the United States but has substantial international operations. Allen Andreas, a director and member of the audit committee, resigned in September over the issue.

The company made the tax disclosure as it was negotiating with lenders over a $1.5 billion credit facility which matures in February. Arntzen said he did not have a time frame for resolving the tax problem, which was being investigated by an outside expert.

The company has reported a loss for 13 straight quarters. It

listed total assets of $4.15 billion and liabilities of $2.67 billion as of June 30.

It is the third-biggest U.S. bankruptcy this year by assets, behind Residential Capital LLC, with assets of $15.68 billion, and Eastman Kodak Co, with $6.24 billion, according to Bankruptcydata.com.

LEASES AT RISK

The company, which employs 3,600, said in a court filing it determined it needed a fundamental overhaul of its finances and operations to recapitalize the business.

Overseas Shipholding has been struggling to plug a looming cash shortfall of up to $600 million. Its $1.5 billion revolving credit facility matures in February and the company had arranged a replacement credit facility, but it only provides $900 million.

The operator of about 112 vessels is likely to use the breathing space of bankruptcy to end uneconomical vessel leases, its main fixed cost, according to an attorney with experience in maritime restructuring.

"The $64,000 question is how does your fleet compare to the competition in terms of efficiency and how does it compare to your needs?" said Ken Rosen of Lowenstein Sandler.

Wells Fargo Securities shipping analyst Michael Webber said above-market leases with ship owner Capital Product Partners LP could be at risk.

About 35 percent of Overseas Shipholding's fleet is leased from companies including Wilbur Ross-backed Diamond S Shipping and DHT Holdings Inc. Oslo-based American Shipping Co ASA has leased 10 tankers to Overseas Shipholding and said it did not expect charter cancellations.

These companies have already written down the value of their contracts with the company, or have begun to look for new customers for their vessels.

Shares of Frontline Ltd, the world's largest independent oil tanker operator, shot up 17 percent on news of Overseas Shipholding's bankruptcy filing.

"People probably think that OSG's bankruptcy will remove capacity from the market, thus helping surviving players like Frontline," said Evercore Partners analyst Jonathan Chappell.

However, Chappell said that even if Overseas Shipholding cut the number of ships it operated, the vessels would likely be remain in service with another operator.

The case is In re: Overseas Shipholding Group Inc, U.S. Bankruptcy Court, District of Delaware, No:12-20000

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