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“Coal is the main fuel for electricity generation in the US, China, India, South Africa, Australia and much of continental Europe - collectively 23% of global primary energy. According to the World Coal Institute (WCI), demand for coal is projected to grow steadily – up 50% by 2030.” said PHLX Vice President of New Products, Daniel Carrigan. “The World Bank cited in 2002 “reliable energy” as a key component of economic and social development. Accordingly, WCI estimates that 85% of future demand will come from developing countries,” Carrigan added.
“Fossil fuels will account for almost 90% of the growth in energy demand over the next three decades versus flat-line growth for nuclear power,” said SIG Indices President, Jamie Farmer. “The environmental challenge will be to increase thermal efficiency while eliminating carbon dioxide emissions. Trade issues and country specific policies have a clear and direct impact on the sector at large. Because of the frequency with which such issues materialize, the coal sector is characterized by significant volatility. Employing options on the SIG Coal Producers Index, investors can isolate these market factors to capture upside appreciation or hedge against sector specific risks,” added Farmer.
