Coal stocks in Hong Kong saw an expansion in their gains before the noon session. As of the latest update, MONGOL MINING (00975) rose 4.06% to HK$11.79; CHINA COAL (01898) increased 3.43% to HK$13.86; CHINA SHENHUA (01088) climbed 3.33% to HK$47.12; and YANCOAL AUS (03668) advanced 2.99% to HK$40.00.
The uptick follows a sudden escalation of military conflict in the Middle East, which has placed significant strain on global energy supply chains. Thermal coal prices have surged to their highest level in over a year as a result. Analysts note that this marks the most substantial external shock to the global coal market since the Russia-Ukraine conflict in 2022. Given the difficulty in quickly filling the current energy shortfall, bullish sentiment remains strong, and high volatility along with elevated prices are expected to persist until the situation stabilizes.
A research report from Orient Futures highlighted that the continued closure of the Strait of Hormuz has led markets to further raise their energy valuation expectations. The duration of the Middle East conflict remains the largest uncertainty. International coal prices have already factored in roughly one month of supply disruption, with further developments being closely monitored. While overseas coal prices remain strong relative to domestic ones, medium- to long-term valuations still face upside risks, with short-term expectations pointing to a volatile market.
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