S&P/ASX 200 Index (ASX: XJO) coal shares are surging on Tuesday after the thermal coal price lifted by more than 8%.
The market's three largest coal miners are among the fastest rising ASX 200 shares today, with energy the only sector in the green.
Currrently, the Yancoal Australia Ltd (ASX: YAL) share price is $6.41, up 3.6%, while Whitehaven Ltd (ASX: WHC) is up 3.2% to $8.20.
New Hope Corporation Ltd (ASX: NHC) shares reached a 52-week high of $5.02, up 5.7%, in earlier trade on news of an extended buyback.
New Hope will extend its on-market share buyback program til 2 March next year.
The coal miner announced the buyback initially in March last year.
New Hope shares are the second-fastest risers on the ASX 200 today, with Yancoal fourth and Whitehaven fifth.
Image source: Getty Images
Coal price lifts overnight
Today's price spike for the ASX 200 coal shares follows an 8.6% lift in the thermal coal price to US$128.70 per tonne in overnight trading.
This is the highest price thermal coal has traded at since mid-December 2024.
Analysts at Trading Economics said the coal price increased due to expectations of resilient global demand despite the green energy transition.
The analysts said:
China, the world's largest coal producer and consumer, continued to add new coal-fired power capacity as Beijing prioritizes energy security and grid reliability.
Investors are also awaiting signals from China's upcoming parliamentary meeting for further demand guidance.
The annual "Two Sessions" will take place from March 4 to around March 11, when authorities are expected to release the 15th Five-Year Plan outlining policy objectives for 2026-2030.
The analysts said US President Donald Trump has also moved to bolster the country's struggling coal-fired power sector.
The US Government has allocated $175 million for modernising six coal-fired plants.
It has also directed the US Department of Defense to procure electricity from additional facilities.
Should you buy ASX 200 coal shares?
CMB International has a buy rating on the ASX 200's largest coal share, Yancoal, with a 12-month price target of $6.84.
China International Capital Corporation (CICC) is also buy-rated with a price target of $6.30.
Jefferies has a buy rating on Whitehaven shares with a $9.50 price target.
Morgan Stanley has a hold rating on the ASX 200 coal share with a $9.80 target.
Morgans has a hold rating on New Hope shares with a $5 target, while Bell Potter has a sell rating with a $4.10 target.
