Coal Prices Surge Again, Europe Prepares for Worst-Case Scenario

Jakarta, CNBC Indonesia - Coal prices have suddenly surged after a period of stabilisation. According to Refinitiv, coal prices closed at US$137.8 per tonne, up 3% in trading on Wednesday (29 April 2026). This strengthening follows a 0.22% decline on Tuesday. Yesterday’s closing price was the highest since 6 April 2026, or more than three weeks ago. Coal prices strengthened amid persistently high oil prices, difficulties in trading through the Strait of Hormuz, and threats of heatwaves. West Texas Intermediate crude oil futures rose 7.17% to US$107.16 per barrel on Wednesday. Meanwhile, the global benchmark Brent crude jumped 6.78% to US$118.80 per barrel. The surge in coal prices is also supported by threats of heatwaves. China, India, and Europe are now preparing for the hot weather as the summer season approaches from May to August. Europe is now facing serious pressure on its energy system due to increasingly extreme climate warming. Quoted from Montel News, scientists and EU policymakers warn that the current conditions fall into the “darkest of the darkest” scenario because they are already directly impacting energy production. Heatwaves, droughts, and reduced snow cover are pressuring hydroelectric power plants (HEPPs) due to falling water flows. At the same time, water resources are shrinking and disrupting cooling systems for power plants, while extreme temperatures increase the risk of disruptions to electrical infrastructure. This pressure is driven by increasingly clear climate trends: more frequent heatwaves, prolonged droughts, and declining snow reserves that have long served as the main water source. The impact is not insignificant. Europe’s energy system is becoming increasingly vulnerable, the risk of electricity supply disruptions is rising, and pressure on energy security and the energy transition is growing. This situation confirms that climate change is no longer a long-term threat but is already directly hitting energy production. On the other hand, China’s coal market dynamics show fairly contrasting short-term movements. Coking coal prices strengthened ahead of the holiday period, driven by steel mill restocking and relatively tight supply. However, this increase is not yet solid due to uneven trading activity and selective demand, as steel industry margins have not fully recovered. Meanwhile, thermal coal prices at northern Chinese ports surged sharply, driven by electricity utility purchases and tight port supplies. Nevertheless, market players are starting to be wary of potential corrections after the holidays. From India, it is reported that non-coking coal stocks at India’s major ports rose slightly by 2.1% in week 17 (ending 25 April) to 14.60 million tonnes from 14.30 million tonnes in week 16, indicating that supply is still available amid weak demand. This increase is relatively limited compared to the previous week, indicating that cargo inflows continue but outflows are also still active. Overall, market sentiment remains cautious, with buyers making purchases according to needs amid a downward price trend, both for domestic and imported coal.