Jakarta, CNBC Indonesia – Coal prices continued to rise in line with rising gas prices. During trading on Tuesday (15/11/2022), the coal price for the December contract on the Newcastle ICE Market was recorded at USD 330 per tonne. The price has risen by 6.8%.
This price is the highest since November 7, 2022 or the past week. The strengthening of prices also extended the positive trend in coal prices, which had increased since last Friday.
The return to coal-stretching over the past couple of days has gone beyond the projections of many. This is because the price of black sand has been declining since mid-October 2022. Coal prices have been hurled past the psychological level of US$400 per ton since October 13, 2022.
In early November 2022, coal prices even fell into a state of suspended animation and did not have the energy to rise. Coal prices weakened for six consecutive trading days from November 3 to 10, 2022. The price fell by 20.2% during these six days of weakness.
However, the price of black sand increased from last Friday to Tuesday this week. In three trading days, coal prices are up 14%.
The recovery in coal prices was supported by sharp increases in natural gas prices in Europe. Gas prices continue to rise as there are supply concerns ahead of winter. Coal is an alternative energy source to gas, so the price goes hand in hand.
The gas price hike has even managed to erase the many negative feelings towards coal, starting from the slowdown of the Chinese economy to the agreements of many countries to increase the share of green energy and get rid of coal.
The price of Dutch EU TTF natural gas (EUR) rose 9.2% yesterday to 124.10 euros per megawatt hour (MWh). Gas prices also rose 5.04% on the week.
The increase in gas prices has also been triggered by disruptions in Norway’s LNG shipments to Europe. Two Norwegian-owned gas plants in Asgard have stopped working after suffering a fire on Sunday (13/11/2022).
It is estimated that the new facility will be able to operate on November 19 at the latest.
LNG transport also from the United States (USA) were halted after LNG producer Freeport suspended refining operations in Texas. The refinery has stopped working since June 2022 there was an explosion.
The United States is the largest supplier of LNG in the world, where its contribution reaches about 20% of the global one. The problem with the Freeport refinery has again raised concerns about the gas supply in Europe, causing gas prices to rise.
Weather forecasting agency Maxar Technologies LLC expects European temperatures to drop this week. The temperature in Berlin, Germany is expected to be even below 0 degrees Celsius.
NatGas Weather.com he also reported that the temperature in the US will be much colder through Nov. 20. In some areas it can even reach less. This condition will increase the demand for natural gas in the United States, which will also increase world natural gas prices.
Europe’s gas supply has actually reached 95% of capacity, but if the air temperature drops, heating and gas use will increase so that the supply may run out.
CNBC INDONESIA RESEARCH TEAM
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