FAST FIVE: US Coal Prices Soar Above $200 Amid Energy Crunch
If not, then electricity generators at power plants will find NatGas uneconomical to run turbines and switch to coal-fired generators.
Data was sourced from US Energy Information Administration, which said this was the highest price in records dating back to 2005. The energy-market shockwaves from Russia's invasion of Ukraine and rejiggering of Europe's energy supply chain have dramatically increased US LNG exports to the EU this summer and fall.
Domestic supplies have significantly tightened the availability for large users, which has pressured prices higher.
As a result, the once-mighty coal industry is returning as the global (in China and Europe) NatGas-to-coal switching could be set to intensify. The rise in coal prices may suggest stockpiling by utilities ahead of a cold winter. Rising spot coal prices have been favorable for big coal companies: Peabody Energy Corp shares rose 6% to $26.25, and Arch Resources Inc.
Worse, US-led sanctions against Russia have further sparked global energy market chaos. Coal's comeback is a remarkable turnaround for an industry that was on the brink of disaster as banks halted financing and investment firms divested from mines and coal-fired power plants, though some of this has been reversed ahead of what's expected to be a cold and expensive winter.