Newcastle thermal coal futures tumbled on December 12 as the sentiment soured after oil prices sank to five-month lows.

 

The January contract on the Intercontinental Exchange fell 6.11% to settle at $143.75/t on December 12, the steepest decline since May 25.

 

Falling crude prices have weighed on the sentiment in the broader energy market. On December 12, Brent crude futures for February settled down 3.7% to $73.24 a barrel. U.S. West Texas Intermediate crude futures for January slipped 3.8% to $68.61 a barrel.

 

The TTF futures for January delivery on the ICE dropped 3.28% to close at 34.94 euros/MWh, data showed.

 

This came due to worries on oversupply and a decline in demand for energy commodities. Warmer weather and large stockpiles have sent coal and natural gas prices tumbling.

 

The United States is entering the heating season with the highest natural gas in storage since 2020, the U.S. Energy Information Administration (EIA) said last week.

 

In the coal market, high-CV thermal coal prices increased slightly amid solid buying from Japan and South Korea.

 

Kpler's data showed Japan is set to import 10.37 million tonnes of seaborne thermal coal this month, the highest since March.

 

Likewise, South Korea's imports are forecast to touch 8.6 million tonnes in December, the data showed, the highest since July 2021.

 

However, China and India, which prefer to use low-CV coal for blending, showed lighter demand for seaborne coal amid steady domestic supply and high inventories.

 

China's coastal power plants now hold stockpiles enough to cover over 16 days of use on average, while India's stockpiles are close to 11 days of generation, data showed.