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"G'day Fools. If you're like us, you're dismayed by the events taking place in Ukraine. It is an unnecessary humanitarian tragedy. Times like these remind us that money is important, but other things are far more valuable. And yet the financial markets remain open, shares are trading, and our readers and members are looking to us for guidance. So, we'll do our best to continue to serve you, while also hoping for a swift and peaceful end to war in Ukraine."
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ASX coal shares are flying high on investors' radars as the price of fossil fuels is rocketing.
In today's action alone, the S&P/ASX 200 Energy Index (ASX: XEJ) is up 4.8% while the broader S&P/ASX 200 Index (ASX: XJO) is down 0.8%.
And some of the top ASX 200 coal shares are leading the charge higher for the Energy Index.
The Whitehaven Coal Ltd (ASX: WHC) share price, for example, is up 4.5%, while New Hope Corporation Limited (ASX: NHC) shares have gained 5.6% today.
Meanwhile, rival ASX 200 coal share, Yancoal Australia Ltd (ASX: YAL), has enjoyed a 6.6% boost to its share price in intraday trading.
Image source: Getty Images
What's boosting ASX coal shares today?
While many factors determine a coal company's share price (management, balance sheet, quality of assets, etc.), the price of the coal they dig from the ground is a major factor.
And coal prices have climbed rapidly recently alongside oil and gas, offering strong tailwinds to ASX coal shares.
Energy prices were already trending higher late last year as the world's pandemic reopening picked up pace. This saw a sharp increase in the demand for energy for both travel and manufacturing outpacing any additional supply growth coming online.
But fossil fuel prices have really taken off in the last month as Russia first massed troops on Ukraine's border and then launched an all-out assault.
Now Western nations are getting serious about imposing sanctions on Russian oil, gas and coal exports.
That's critical here because Russia is the second largest oil exporter and third largest coal exporter in the world. The prospect of removing that much supply, or even a significant slice of it, has sent crude oil prices to 13-year highs today and coal surging to another all-time high of some US$420 per tonne.
Aussie coal to the rescue?
Somewhat ironically for an industry that's taken so much flack for the 'dirty energy' it provides, nations the world over are turning to Australia to potentially help fill any void left by a ban on Russian coal.
As The Australian reports, despite Poland relying on Russia for 90% of its coal needs, "the country's government has led the European charge to impose sanctions".
Poland is among the countries that may be getting a lifeline in the form of additional shipments supplied by ASX coal shares. "Industry sources say officials also sought information on whether coal supplies could be made available to customers in South Korea and Japan."
According to Resources Minister Keith Pitt (quoted by The Australian) the Aussie government is "facilitating access to Australian thermal coal producers to interested parties as they seek alternative supplies from Russia. Australian producers have indicated they are willing to help our friends and allies if they can."
But ramping up coal mining isn't as simple as turning up the tap.
With most ASX coal shares already producing near their production peak, it will take some time before capacity can be significantly ramped up. Which could see the price of coal remain elevated.
How have these ASX coal shares been tracking?
All 3 of the ASX coal shares mentioned above have trounced the benchmark index of late.
Over the past month alone, the New Hope share price is up 24.5%, Whitehaven shares have leapt 46% and the Yancoal share price has rocketed an eye-popping 71.5%.
To put that into context, the ASX 200 is down 1.4% over the past month.
