A mix of US politics, international finance, labor force difficulties, and systematic overestimation of green energy technology has led to a spike in coal prices and demand.
Pandemic slowdowns of industry, now reanimated, are driving a greater demand for cheap, reliable energy.
The low efficiency, intermittent nature of wind, solar and other fully renewable energy sources contribute to the persistent demand for fossil fuels, like coal.
US Democrats are wrangling over environmentalism and preservation of the Appalachian coal industry. Joe Manchin, a moderate senator from West Virginia, is seeking to protect the Mountaineer State’s coal industry. Most other Democrats appear ready to ram through unrealistic renewable energy goals included in various parts of the stimulus bill.
China consumes one-half of the world’s coal, but is using less coal from Australia, its main supplier, because of political beefs. Other suppliers, such as the US and other parts of Asia, are trying to meet demand. European increase in demand is also a factor.
This is coupled with the upcoming winter and US coal industry’s difficulty finding laborers. The reasons for the latter are several including increasingly shrill cultural snobbery towards fossil fuel, fewer new or young laborers overly generous unemployment benefits tamping down incentive of job seekers, and coal workers choosing to stay on with new careers found during pandemic lay offs.
All of this has been a boon to investors, domestically and international. ARCH, a coal-related energy stock was double an early-April price at the stock’s opening bell on Friday.
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