Coal prices are staging a comeback
Coal, the dirtiest of fossil fuels, is staging something of a comeback. Prices for the Australian benchmark are up about 60% since mid-February, as European power plants scour the globe for alternatives to pricey natural gas.
The big picture: Coal-fired electricity generation had been on the decline for a decade, to about 13% of Europe's mix in 2020, as power providers began phasing out the most carbon-heavy fuels. But Europe’s energy crisis, which kicked into high gear last year, is breathing new life into the coal market.
- For the first time in almost 10 years, coal generation in Europe actually grew in 2021, by about 18%, according to preliminary estimates recently published by Rystad Energy.
What we’re watching: Coal prices could rocket even higher in the next few months because Russia is Europe’s largest coal supplier, Rystad analysts wrote Thursday.
The bottom line: Companies once left for dead — like the recently-bankrupt Peabody Energy — have been resuscitated. Peabody's stock has more than doubled since January, even as the major indexes slumped into corrections. It's up eightfold — from just $3 — over the last year.