Goldman Sees Indian Coal Worsening Glut in World Awash in Fuel
- Lowers price forecasts for thermal coal, liquefied natural gas
- Decline in coal demand may be irreversible, analysts write
A worker is reflected in a puddle as he walks towards a truck at an open cast coal mine in Jharkhand, India.
Photographer: Sanjit Das/BloombergSlumping global coal and liquefied natural gas prices will be under further pressure as rising Indian coal production exacerbates a glut of power-generation fuel, according to Goldman Sachs Group Inc.
The prospect of higher output from India, which is forecast to overtake China as the world’s largest importer of thermal coal, will likely cause a 10 percent contraction in seaborne trade of the fuel by 2020, the bank’s analysts including Christian Lelong wrote in a report dated Feb. 15. The oversupply of coal and gas and weakening electricity demand prompted Goldman to lower its price forecasts for thermal coal and spot liquefied natural gas in east Asia and Europe for the next three years.