Japan and South Korea Increase Coal Imports

Japan and South Korea have increased coal-fired power generation and coal imports after LNG shipments from the Middle East were sharply reduced by conflict-related disruptions in the Strait of Hormuz. Gas-fired power generation in both countries, the world's second- and third-largest LNG importers after China, fell to multi-month lows in April and early May.

No Qatari LNG cargo passed through the Strait of Hormuz between Feb. 28 and early May, when the first vessel since the halt reached Pakistan. LNG prices in North Asia have risen more than 60 percent since the conflict began while seaborne coal prices increased by 13 percent.

In response, Japan raised coal power generation by 11.1 percent in April, the largest monthly increase in a year, while gas power output dropped 13 percent. South Korea recorded an even larger shift, with coal-fired power supply jumping 40 percent in April, the biggest rise since August 2019.

Japan received its first shipment of Central Asian crude oil since the disruptions began when a tanker carrying 45,000 kiloliters of oil from Azerbaijan arrived at an Eneos refinery in Yokohama. The country had already taken delivery of U.S. oil in late April and Russian oil earlier this month.

Eneos said the Japanese oil industry would work with government agencies to maintain stable supplies. Global coal shipments to South Korea, Japan and the European Union rose 27 percent in March and April compared with a year earlier as buyers sought alternatives to disrupted oil and gas flows from the Middle East.

The conflict has not disrupted global coal supply chains but has driven higher demand for the fuel.

India called for accelerated development of domestic coal gasification to reduce reliance on imported fuels and chemicals amid the global energy shocks. Coal gasification converts coal into synthetic gas that can be used to produce methanol, ammonia, urea and other chemical feedstocks currently imported at an annual cost of nearly Rs 2.77 lakh crore.

Balasaheb Darade, founder and managing director of New Era Cleantech Solutions, said India cannot build long-term resilience against global energy shocks without a large domestic coal gasification industry. Darade noted that China, with nearly 350 million tonnes of coal gasification capacity, maintained supply stability during the crisis while other import-dependent economies faced shortages and price spikes.

Kapil Bansal, partner at EY-Parthenon, said LNG shortages, fertilizer disruptions and force majeure risks have exposed vulnerabilities in economies like India. Pavan Kaushik, corporate advisor for mining and infrastructure, added that reducing dependence on imported energy, of which India imports 89 percent of its crude oil needs, has become critical.

Experts described the policy as a strategic measure for energy security, import substitution and economic self-reliance rather than a short-term response. >"Without developing a large domestic coal gasification ecosystem, India cannot build long-term resilience against global energy shocks.

" — Balasaheb Darade, May 2026 (Economic Times) Prime Minister Narendra Modi had appealed to citizens to conserve fuel and reduce use of imported products to ease pressure on foreign exchange reserves during the supply chain disruptions.

International seaborne coal prices rose far less than LNG prices, making coal a more economical option for power generation in the short term. Both Japan and South Korea boosted coal imports to offset lost gas volumes and capitalize on the relative price stability of coal.

The first Qatari LNG cargo to clear the Strait of Hormuz since late February arrived in Pakistan in early May, but overall Middle East supply remains constrained.