Iran War Disrupts LNG, Boosts Coal

The ongoing Iran war has led to significant disruptions in the global energy market, particularly impacting Liquefied natural gas (LNG) supplies. Iranian retaliation to US-Israeli attacks knocked out 17% of Qatar's LNG export capacity, causing Asian spot LNG prices to surge by 62%. In response, major Asian importers, Japan and South Korea, have sharply increased their coal-fired power generation in April and early May. Japan's gas-fired power supply hit two-year lows, while South Korea's dropped to six-month lows. Both nations are projected to see substantial increases in Coal imports in May, with South Korea's rising over 50% and Japan's over 20%. This shift underscores a broader trend where energy security is prioritizing over economic considerations. Additionally, a heatwave in Southeast Asia contributed to a surge in Vietnam's coal-fired output and imports.