Coal Rises on Tightening Supply
Coal futures climbed above $145 per ton, rebounding from one-month lows as tightening global supplies and the prolonged Middle East conflict continued to encourage a shift from gas to coal for power generation. Indonesia, the world’s largest exporter of thermal coal, reported that shipments fell 23% in August from a year earlier to their lowest ...
As coal futures surged above $145 per ton, the latest data revealed a significant drop in global shipments. Indonesia, the world's leading exporter of thermal coal, saw August exports plunge by 23% compared to the previous year, marking the lowest level in five years. This decline coincides with a surge in global coal demand, projected to hit a record high this year, driven by gas supply disruptions due to the ongoing conflict in the Middle East.
Indonesian thermal coal exports have been further hampered by government-imposed production quotas, policy uncertainty, and the impact of a strong El Niño event. The International Energy Agency's latest Coal Mid-Year Update 2026 highlighted that soaring LNG prices, a result of the Strait of Hormuz blockage, are prompting countries like China, India, Japan, South Korea, and even Europe to increase their use of coal-fired power generation.
The situation underscores a growing trend among economies that were previously reliant on gas for power production, shifting towards coal as a more cost-effective alternative. This shift is not only a response to the current supply crunch but also a long-term strategy to mitigate the effects of fluctuating energy prices and ensure energy security amidst geopolitical tensions.
Written by urgent.news from Hellenic Shipping News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
