KO KOL VanEck Coal ETF Loading... : Bullish and Bearish Analyst Opinions

The administration is stopping the closure of coal-fired power plants and is actively upgrading and expanding some coal capacity, which will sustain and potentially increase coal demand for power generation.

Coal becomes very attractive post-Hormuz because it is cheap and is a domestic energy source in most major consuming countries affected by the crisis. As governments link energy sources to national security, coal companies will benefit significantly from policy support and renewed demand, reversing their prior decline.

Coal becomes attractive as a cheap, domestic energy source for many countries affected by Hormuz, now linked to national security; coal companies will perform extremely well as governments prioritize secure energy.

Coal is making a comeback under the Trump administration's energy policy, which promotes 'clean, beautiful coal' as a reliable and domestic source of power, benefiting the coal industry.

The administration ended the war on coal, signed an order to drill, and invested over $1 billion to save coal mines and over 100 coal power plants, declaring coal clean and beautiful, while China builds 57 new plants, making U.S. coal production and jobs surge.

Coal is becoming dominant again for two reasons: the Far East is building more coal power plants and China has been restocking massive amounts of coal in recent months. Coal is also becoming a strategic commodity for the United States, which is exporting more coal to India and elsewhere. The Strait of Hormuz crisis is another alarm bell that the world should not rely so heavily on oil, giving coal a further boost. In the short term, coal is becoming quite important in the energy market, and an expected El Niño in 2026 will massively increase coal needs from China, Japan, and Korea in the coming months.

Renewable power is intermittent, depending on sun and wind. To keep the lights on around the clock, coal, gas, and nuclear remain part of the energy conversation and will be needed as base load power.

Despite the green narrative, coal demand remains strong with China and Germany increasing usage. Investors should consider coal as a real asset that is widely ignored.

For the MSCI China market, earnings revisions are the key driver. We prefer defensive sectors with steady earnings growth. In our second-quarter portfolio we highlight banks (high dividend yield with RMB appreciation tailwind), energy, coal, and materials (where earnings revisions are stronger and share prices are outperforming).

In Asia, there is a current tendency to use more coal instead of natural gas and a push for renewables due to the energy supply disruption.

The war in Iran has heightened focus on energy security, leading to increased demand and higher prices for upstream energy assets and critical minerals. Indonesia is a net exporter of coal and nickel, and the war's impact will last for 9-12 months, creating a new normal in commodity prices.