Global Coal Consumption Set to Reach Record High Amid Oil and Gas Disruptions
The International Energy Agency (IEA) is forecasting that global coal consumption will reach a record high this year, driven by disruptions in oil and gas supplies caused by the closure of the Strait of Hormuz.
As oil inventories dwindle and nations expand their renewable energy capacity, some countries are turning to coal as an alternative source of energy. The IEA predicts that coal usage will rise in certain regions due to anticipated increases in natural gas prices in 2026.
The Strait of Hormuz has been a critical trade route for oil and gas shipments, but recent conflicts have led to restrictions on maritime trade, causing severe global energy supply disruptions and pushing up the cost of oil and gas. Asian nations, including Japan, India, the Philippines, South Korea, and Thailand, as well as some European countries, are increasing their coal consumption to offset the shortfall.
The IEA projects that demand for coal will grow by 1.2% in 2026, pushing global consumption to a record 8.94 billion metric tons. China and India, the world's two largest coal consumers, are expected to see demand rise by 1% and 4.2%, respectively.