Coal Prices Fall, Trump's Assistance Lacks Impact

Coal prices have levelled off after a period of recent increases. According to Refinitiv, July coal contracts closed at US$147.05 per tonne on Thursday (4/6/2026), representing a 0.64% decline.

This weakening follows a 2.21% surge recorded on Wednesday. The decline in coal prices coincides with a softening in global oil prices, as coal and oil are interrelated commodities acting as substitutes for one another.

Oil prices fell by approximately 3% on Thursday following reports that US President Donald Trump is reluctant to pursue full-scale war with Iran, despite recent clashes. West Texas Intermediate (WTI) crude contracts dropped 3.1% to close at US$9_93.04 per barrel, while Brent Crude, the international benchmark, weakened by 2.8% to US$95.03 per barrel.

Coal prices remained under pressure despite positive news from the United States. On Thursday, Trump announced the use of Cold War-era legislation to inject US$700 million into various coal projects. This move represents the latest effort by Trump to increase the use of coal, the most environmentally polluting fossil fuel.

Trump stated that the funds would be used to maintain the operations of more than a dozen coal-fired power plants across 10 US states and 42 coal mines, as well as to construct two new power plants and one coal export terminal. The funding will be distributed through the Defense Production Act, a 1950 legislation that grants the US President emergency powers to regulate and support domestic industries deemed vital to national interests.

Despite Trump’s continued push for a coal industry resurgence, the sector continues to shrink. US coal production is currently less than half of its 2008 levels, and the number of miners has plummeted by more than 90% compared to a century ago. Natural gas and renewable energy are considered cheaper and are increasingly dominating the US electricity supply.

Meanwhile, in China, thermal coal prices at northern ports have begun to stabilise after previously strengthening due to supply disruptions. Market focus has now shifted from supply concerns to demand uncertainty.

Coal supplies are beginning to recover as mines that were previously disrupted have resumed operations following successful safety inspections. Coal inventories at ports remain relatively high, reducing market confidence that prices will continue to rise.

While sellers are reluctant to cut prices too deeply as the peak summer electricity consumption season approaches, buyers are also hesitant to make large purchases as their existing stockpiles remain sufficient.