According to CNBC, global energy supply is expected to be tightcoalConsumption will return to record levels reached nearly 10 years ago, with coal prices soaring.

(Source: WeChat public account "International Energy Small Data" Author: E Small Data)

Coal stock investors performed well due to high coal prices. Since the Russian-Ukraine War, governments across the country have been scrambling to ensure energy supply and restricting carbon emissions are taking a secondary position. “Who could have thought that dirty coal would be the best performing stock in the last fiscal year. It was also the best performing industry so far this fiscal year. Looking ahead, countries are turning to coal as Europe’s natural gas prices and supply tight supply, which could continue until 2023.”

The continued surge in coal demand is driven by gas shortages as the EU takes action to reduce the use of Russian natural gas, while Russia responds by cutting gas supplies to the continent. The price of thermal coal used for power generation has risen by about 170% since the end of last year.

In contrast, another major trading coal, steelmaking raw material, has a lower trading price. China's economic growth slowed down cooling steel production, which in turn led to a decline in demand for coking coal. A new report released by the International Energy Agency warns that assuming China's economy recovers as expected in the second half of the year, globally in 2022Coal consumptionVolume will grow by 0.7%, with global totals reaching an annual record set in 2013, and coal demand may further increase to an all-time high next year.

The IEA said that when the global economy recovered from the initial shock of the coronavirus pandemic, global coal consumption had rebounded by about 6% in 2021. Coal consumption in the EU is expected to grow by 7% in 2022 based on a 14% increase last year. This is driven by demand from the power sector, where coal is increasingly being used to replace natural gas. Several EU countries are extending plans to closeCoal and electricityPlant lifespan, reopening closed power plants or increasing operating time limits to reduce gas consumption. ”

At the same time, boycotts of Russian coal have further increased upward pressure on coal prices. Global coal prices are rising and pushing up natural gas prices. Europe's worst concerns are becoming a reality after Russia cuts flow through the Nord Stream pipeline to 20% of capacity. Natural gas stocks may not reach levels that are sufficient to survive the winter.