Japan and South Korea boost coal use amid LNG supply cuts

Japan and South Korea increased coal-fired power generation in April and early May as the Iran war disrupted liquefied natural gas supplies. Retaliatory strikes knocked out 17% of LNG export capacity in Qatar. Asian spot LNG prices have surged 62% since the war began, compared to a 13% rise in the Newcastle coal benchmark, forcing utilities to switch toward coal for power generation.

Japanese gas-fired power supply fell to two-year lows in April, while South Korean levels hit a six-month low. Data from the Japanese Electricity Market Data Hub and Korea Power Exchange confirmed the decline. Andre Lambine, a power analyst at S&P Global Energy, said the power switching will likely increase as the conflict continues.