One fossil fuel continues to fetch booming prices even though world leaders promised to transition towards renewable alternatives.
Demand for coal enjoyed a “strong industrial rebound” throughout the pandemic, with more developed nations choosing to either “phase up” or “phase down” consumption instead of phasing it out. AMR understands widespread power outages, natural disasters and the escalating energy crisis were key deciding factors.
The commodity fetched spot prices exceeding US$600 (A$938.47) a tonne shortly after the Russia-Ukraine border conflict escalated back in February 2022. This fuelled speculation about further coal price hikes in the New Year.
“It is very much hanging in the balance at the moment about whether coal will set a new record this year, gas will set a new record and power sector-emissions will set a new record,” Ember lead analyst Dave Jones said according to Bloomberg News.
“The world cannot just turn off all of its coal powered generation. It is going to take some time and there just is not enough supply response coming on, so we think prices will remain elevated,” New Hope Group CEO Robert Bishop added.
The remarks came after the United Nations spent most of 2022 urging each member country to “consign coal to history”. To this end Whitehaven Coal believes decarbonisation is important but the process must be handled in a “responsible and coordinated” manner.
“This is a journey that will take decades, not years. Traditional energy sources like coal are critical to providing a reliable base load of energy,” company chairman Mark Vaile previously told shareholders.
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