Numerous countries have initiated long-term climate strategies, aiming to phase out coal in the coming decades. However, due to gas shortages and the slow expansion of renewable energy capacity, coal remains a crucial energy source for power generation and industrial needs in several regions.
Considering the prolonged dependence on coal, it could be wise to monitor resilient coal stocks CONSOL Energy Inc. (CEIX – Get Rating), Hallador Energy Company (HNRG – Get Rating), China Shenhua Energy Company Limited (CSUAY – Get Rating), and SunCoke Energy, Inc. (SXC – Get Rating) for potential gains. Let’s understand this in detail.
While coal has endured as a dependable electricity source, it remains the foremost producer of carbon dioxide emissions. Consequently, the ongoing efforts of leading global powers to replace coal with renewable energy sources are expected to lead to a gradual, protracted reduction in coal consumption over an extended period.
Nonetheless, the transition is perceived as exceptionally sluggish. Despite the resounding climate commitments made by numerous major global players, it appears that breaking their coal dependency remains a formidable challenge, with consumption poised to reach an unprecedented peak once more.
Just a few months ago, an International Energy Agency (IEA) report indicated that coal consumption is projected to reach a historic zenith and persist at this level from 2022 to 2025 unless the shift towards cleaner alternatives accelerates significantly.
Moreover, according to the IEA, global investment in coal production and supply is set to rise by about 10% in 2023, exceeding the $135 billion spent in 2022. Almost 90% of this investment is expected in the Asia Pacific region, notably in China and India, as both countries aim to expand production and develop new coal mines.
As per a Research and Markets report, the global coal market expanded from $614.96 billion in 2022 to $621.89 billion in 2023, achieving a CAGR of 1.1%. Projections indicate that the coal market is poised to reach $658.68 billion by 2027, with a CAGR of 1.4%.
In light of these encouraging trends, let’s look at the fundamentals of the four leading Coal stocks, beginning with number 4…
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