Coal is hot commodity now

High oil prices have led to demand growing at the fastest pace.

Coal is the world's fastest-growing energy source as rising oil prices prompt users to switch fuels, according to the US Energy Information Administration.

Coal's share of total world energy might climb to 28 per cent in 2030 from 26 per cent in 2004, the agency, a part of the US Energy Department, said in a report published yesterday. Consumption was growing at an average of 2.2 per cent a year. The fuel would overtake oil to become the largest source of carbon dioxide emissions by 2010, the report said.

"With oil and natural gas prices expected to continue rising, coal is an attractive fuel for nations with access to ample coal resources, especially in coal-rich countries such as China, India and the United States,'' the report said. "These three countries combined account for 86 per cent of the increment in world coal demand by 2030.''

Crude oil on the New York Mercantile Exchange has more than doubled since the start of 2004. Prices of Newcastle coal have gained 33 per cent in that period, according to the McCloskey Group. Petroleum and other liquid fuels will have a 34 per cent share of global energy use in 2030, down from 38 per cent in 2004.

Coal consumption would fall in Europe and Japan, where natural gas and nuclear power are likely to continue providing significant amounts of electricity, the report said.