global coal consumption in 2023 could grow by 1.4%, to a record 8.54 billion tons

Global coal consumption in 2023 could grow by 1.4%, to a record 8.54 billion tons, the International Energy Agency (IEA) predicts. The organization’s new report notes that by the end of this year, a noticeable decrease in demand for coal will be recorded in all developed economies, the most significant in the USA and EU countries: by 21% and 24%, respectively (see chart).

However, the reduction in consumption in developed countries will be compensated by its growth in developing countries: primarily in India (by 8%, to 1.26 billion tons) and China (by 5%, to 4.74 billion tons). Also, consumption growth will be observed in Indonesia, Vietnam and the Philippines – together, these countries account for more than 70% of global coal demand. Thus, the IEA records an acceleration in the process of shifting coal consumption and production to Asian countries.

The agency’s analysts have no doubts that developing countries will only increase coal consumption in the coming years. According to their forecasts, in unfavorable scenarios (further development of international conflicts, including the Russian military operation in Ukraine), maintaining sustainable economic growth may cost these states the failure to fulfill their “climate” obligations.

The future of coal in the energy market will mainly continue to be determined by China, the IEA believes. It is expected that in 2024 the demand for it in China will decrease and will remain at a relatively stable level – about 4.5 billion tons per year – until 2026. The “lost” volumes of coal, according to agency forecasts, will be replaced by renewable energy sources, including solar. Even if other countries do not accelerate the pace of implementation of green energy, global coal demand by 2026, according to IEA estimates, will fall by 2.3% compared to 2023, to 8.34 billion tons.

However, IEA analysts have no firm confidence that the future of the Chinese and global energy markets will be exactly like this – which is understandable, given the multidirectional dynamics of China’s economic indicators (see Kommersant on November 8 and 27). In particular, it is not yet entirely clear whether the Chinese authorities have been able to stimulate extremely restrained domestic demand with new government support measures.

Kristina Borovikova