• The IEA forecasts 2026 global coal demand at 8.94 billion tonnes, up 1.2% from a record 8.84 billion tonnes in 2025.
• The Hormuz link to coal is price, not cargo: disrupted LNG shipments raised gas prices and made coal more competitive for power generation.
• Newcastle thermal coal averaged USD 139 per tonne in June and USD 131 in August 2026, far below the 2022 peaks above USD 400.
• For 2027, the IEA sees a 0.4% fall to 8.91 billion tonnes if Middle East tensions ease, and a possible further rise if the disruption persists.
• This desk's reading is that already-connected capacity delivered in this shock, while announced and financed capacity still under construction could not have.

Global coal demand is on course for another record in 2026, and the mechanism runs through gas rather than through the Gulf's own barrels. As of 21 September 2026, the International Energy Agency's Coal Mid-Year Update 2026 puts demand at 8.94 billion tonnes, up 1.2% from 8.84 billion tonnes in 2025. For the transition ledger the point is narrow: when LNG tightened, the capacity that delivered was the existing coal fleet, not announced or financed additions. This is analysis, not trading advice.

What the IEA actually forecast

The IEA's Coal Mid-Year Update 2026 puts 2025 global coal demand at 8.84 billion tonnes, a record after 0.3% growth, and forecasts 2026 at 8.94 billion tonnes, up 1.2%. The upward revisions are attributed mainly to the Middle East conflict and weather-related factors. These are agency forecasts, not measured outturns, and the year is unfinished. Secondary coverage, including OilPrice.com, also cites country-level figures for China, India and the United States; we have not reconciled them against the IEA text and do not rely on them here.

Why Hormuz moves coal without touching a coal cargo

Coal does not transit the Strait of Hormuz, so the link to the coal market is price rather than cargo. The IEA says the conflict disrupted LNG shipments through the strait, raising natural gas prices and making coal more competitive for power generation in several markets. OilPrice.com describes the disruption as a closure; the IEA wording we reviewed refers to disrupted shipments. We do not quantify the LNG shortfall, and any tanker-tracking figure for it would be an unconfirmed estimate.

A forecast record at moderate coal prices

The IEA reports Newcastle FOB thermal coal averaged USD 139 per tonne in June 2026 and USD 131 in August, far below the crisis peaks above USD 400 per tonne recorded in 2022. A forecast record burn at moderate prices suggests the coal supply chain has so far absorbed the extra demand, while the scarcity sits in gas. That reading is our inference, not an IEA finding, and it could change quickly if the gas disruption lasts.

The Transition Desk read: existing capacity delivered

In this shock, the capacity that delivered was the capacity already built and connected. Coal-fired units could be dispatched harder as gas prices rose; announced and financed renewable projects still under construction could not have responded. This is our reading of the pattern, not an IEA conclusion, and it does not make coal the better long-term bet. The distinction between announced, financed and delivering capacity is the test this desk applies, and here only one category answered the call.

What decides 2027

The IEA calls the outlook for 2027 highly uncertain. If Middle East tensions ease and LNG supply recovers, it expects global coal demand to fall 0.4% to 8.91 billion tonnes, still above the 2025 level; if the disruption persists, demand could rise further. The variables to track are LNG flows through Hormuz, Newcastle coal prices and the strength of the El Niño the agency expects to raise Asian cooling demand and cut hydropower output. This is analysis, not a trading recommendation.