Coal Prices Fall After Two-Day Surge

Jakarta, CNBC Indonesia – Coal prices eased after a two-day rally.

April coal futures in trade on Wednesday (4 March 2026) closed at US$132.9 per tonne, down 3.7%. The decline broke the coal market’s bull run, which had surged 17.2% over the previous two days.

Coal prices eased as global energy prices softened.

Crude oil prices were still higher on Wednesday, but not as steep as on Monday and Tuesday, rising by a little over 5%. European gas prices had fallen by almost 4% by Wednesday.

The softer energy backdrop has fed through to coal, which acts as a substitute commodity.

Coal prices had briefly jumped to around US$138 per tonne on Tuesday, reaching the highest since November 2024, after an outage at Qatar’s LNG facility raised demand for fuel switching in the power generation sector.

The rise followed an Iranian drone attack on Qatar’s main LNG export hub, highlighting rising tensions in the Middle East. The facility supplies around 20% of global LNG and has never fully ceased operations in its 30-year history.

With many Asian economies reliant on LNG from Qatar, Taiwan signalled the possibility of increasing coal-fired generation if the supply disruption persists.

Meanwhile, expectations for strong global demand remained supportive, even as the push toward cleaner energy continues. China, the world’s largest producer and consumer of coal, continues to add new coal-fired capacity to secure energy and keep the grid stable.

China’s domestic thermal coal market performed relatively well in February, driven by solid power demand after the winter and bullish sentiment in energy markets.

Factors underpinning February strength included stable electricity demand from utilities and industry and positive market sentiment, partly spurred by concerns about global energy supply.

However, market participants began questioning whether the momentum could last until the end of March. Several factors could weigh on the market, including the end of the heating season in China.

With warmer temperatures, electricity demand for heating in northern regions typically falls, reducing coal consumption at power plants.

Inventories at six major coastal power generation groups stood at around 13.82 million tonnes, up about 2.3% from before the Lunar New Year holiday.

After the post-holiday demand period, buyers became more cautious about prices deemed high.

Nevertheless, some market players said domestic coal prices still had support, especially as imported supplies are not cheap and China’s energy policy continues to rely on coal to maintain energy security and grid stability.