Asian Nations Boost Coal Use Amid Iran War-Induced LNG Crisis

Asian nations are increasing their coal-fired power generation due to the ongoing war in Iran, which has disrupted liquefied natural gas (LNG) supplies and driven up prices. Japan's gas-fired power supply hit two-year lows in April, while South Korea's dropped to six-month lows, according to data from the Japanese Electricity Market Data Hub and Korea Power Exchange (KPX).

The conflict has knocked out 17% of LNG export capacity in Qatar, the No. 2 global supplier. 'The longer this war continues, the more switching we will see,' said Andre Lambine, a power analyst at S&P Global Energy.

Japan's coal-fired power output surged 11.1% in April, with gas-fired power plummeting 12.9%. South Korea saw its coal-fired power supply rise by 39.7%, while gas-fired power fell 6.4%. Nuclear supply decreased in both countries during the same period.

Coal imports are expected to rise as utilities scramble to secure power supplies, with Vietnam's coal-fired output surging 12.3% last month and pushing coal's share in its power mix to a high since March 2024. Asian thermal coal shipments outside China and India are also set to increase by 9.4%, according to DBX Commodities.