• 4 minutes Energy Armageddon
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 10 minutes Russia Says Europe Will Struggle To Replace Its Oil Products
  • 6 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 5 hours Reality catching up with EV forecasts
  • 10 days "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 4 days 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 9 days A Somewhat Realistic View of the Near Future for Electric Vehicles Worldwide
Coal Is Staging A Major Comeback

Coal Is Staging A Major Comeback

The “dirtiest fossil fuel” is…

Anatomy Of A Trade: Knowing When You Are Wrong

Anatomy Of A Trade: Knowing When You Are Wrong

Admitting one is wrong on…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Bright News In Dark Times For The Coal Sector

As I discussed last week, there’s been carnage in the coal sector of late. With major producers like Peabody Energy teetering on the brink of bankruptcy.

Reading the headlines, it appears the world has given up on coal as a commodity. Which made it all the more surprising the past week to see a major coal-positive announcement emerging from Southeast Asia.

That came from Vietnam. Where the government said it is going to require a massive amount of new coal supply — very quickly.

Platts broke the story that an official report last Friday projects Vietnam’s coal demand to rise by over 80 percent by 2020. With consumption expected to hit 86.4 million tonnes per year — up from 47.5 million tonnes demand estimated for 2016. Related: What Happens When Oil Hits $50?

ADVERTISEMENT

That’s an astonishing rise — equating to nearly 40 million tonnes of additional yearly demand. And vastly exceeding Vietnam’s domestic production, which ran just 41.5 million tonnes in 2015.

Officials are expecting domestic coal output to rise slightly — to between 47 and 50 million tonnes per year by 2020. But even with such growth, Vietnam would still be looking at imports of 35 to 40 million tonnes per year to meet overall demand. Related: The Current Oil Price Rally Is Reaching Its Limits

Such a level of coal imports would be a massive increase from today. In 2015, Vietnam imported just 7 million tonnes of coal (although that figure was up 125 percent from 2014).

ADVERTISEMENT

All of which suggests we could see imports here rise by over 30 million tonnes annually over the next few years. That’s not quite on the level of super-importers like China, Japan or India — but it would be very significant for the global market. Related: New Biofuels Alternative Could Upend Oil Markets

Of course, these are only forecasts at this point. But the scale of projected demand increases suggests that a major trend toward increased coal use is in motion across Vietnam. Whatever the final numbers, it appears assured the country is going to rocket to importance in terms of global coal buying.

Add that to rapidly rising coal demand in nearby nations like the Philippines, and supply could get tight fast in this part of the world. Watch for more data on growing demand and imports in this X-factor locale.

Here’s to being down but not out

By Dave Forest

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage


ADVERTISEMENT


ADVERTISEMENT



Leave a comment
  • Steve Leary on March 24 2016 said:
    This may not be the full story on coal in Vietnam, since in January the Vietnamese Government announced it was to review its Coal Policy and that a full announcement would be made, I think, in June

    Here is one news item on this: 'Vietnam Plans Move Away From Coal' (Clean Technica, 28/1/16) @ http://cleantechnica.com/2016/01/28/vietnam-plans-move-away-coal/?utm_content=bufferfe373&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News