Coal Falls to Over 7-Week Low

Coal prices slipped below $130 per ton, easing from the 17-month high of $146.5 reached on March 20 to the lowest level in over seven weeks, as renewed hopes for US-Iran talks raised expectations that energy flows through the Strait of Hormuz could resume. Traders continue to monitor diplomatic signals closely, with the key shipping route still largely shut but seen as critical to restoring supply. The potential easing of gas disruptions could reduce the need for gas-to-coal switching in power generation. Still, the prolonged Middle East conflict continues to embed a risk premium across energy markets, having driven utilities in Asia and Europe to rely more heavily on coal. Despite the recent pullback, coal prices remain up nearly 9% since the war began in early March.

Coal decreased to 133.75 USD/T, the lowest since March 2026. Over the past 4 weeks, Coal lost 0.04%, and in the last 12 months, it increased 41.31%.

Futures of thermal coal shipments out of Australia were above $130 per ton in April, maintaining most of the surge from March as the outbreak of war in the Middle East triggered shortages in energy commodities, favoring coal alternatives. The war in the Persian Gulf drove Iranian forces to strike tankers carrying liquified natural gas and liquified petroleum gas crossing the Hormuz chokepoint. Supply from the region was further dented as major natural gas processing facilities were hit in Qatar. The developments removed a large portion of feedstock for gas-powered plants in Asia, including Japan and Korea, which are the main consumers of higher grades of Australian thermal coal out of the Newcastle port. Ample appropriate facilities from the two large economies propel gas-to-coal switching for power generation, unlike China and India, which have more steady capacity and usually bid for lower-grade thermal coal.