Coal Never Died—Here Are Two Picks Built for This Moment
'Crisis Investing' Issue 4 / April 2026 – Vol 3
Dear Reader,
I’ve been called a contrarian for so long that I’ve started to think of it less as a label and more as a job description. And one of the positions I’ve held longest — one that’s drawn the most eye-rolls over the years — is that coal never went away. Nor is it going away.
Coal — just like oil or natural gas — is simply an arrangement of carbon, hydrogen, and oxygen. The friendliest elements, concentrated into portable, reliable energy that actually works when you need it. I’ve always been a fan.
Yes, the Western world declared war on coal. Politicians made speeches. Pension funds divested. ESG consultants wrote lengthy reports about the inevitable transition. Coal was supposed to be finished — a relic of the industrial age, embarrassing to own and dangerous to defend. And yet, quietly, the world kept burning it. Global coal demand hit all-time highs even as the eulogies were being written. China kept building coal plants. India kept building coal plants. Japan — which the world thinks of as a sophisticated, technologically advanced nation — never really stopped either. The funeral kept getting scheduled. Coal kept not showing up to it.
All of that is now being laid bare by what’s happening in the Gulf. The Iran war and the energy crisis it has unleashed have done something that years of data and argument couldn’t: they’ve stripped away the comfortable fiction and shown the world exactly how exposed it really is.
All of a sudden, scores of countries — across Europe, and particularly across Asia — found themselves staring into an energy abyss they’d spent years pretending didn’t exist. The Strait of Hormuz, through which roughly a fifth of the world’s oil and LNG flows, is effectively closed. And the countries that depend on it most have discovered, the hard way, that dependency and vulnerability are the same thing.
Consider Japan. It imports 87% of its total energy. Of its crude oil, 95% comes from the Middle East, and roughly 70% of that travels through Hormuz. With the strait closed, two-thirds of Japan’s oil supply is blocked. Not at risk. Blocked. It is now burning through emergency reserves that cover perhaps two to three weeks of stable LNG demand. South Korea is in essentially the same position — importing 98% of its energy, heavily dependent on the same routes. Australia has 38 days of fuel reserves. India, 1.4 billion people, imports 85% of its oil with heavy Middle East exposure. The list goes on.
These countries don’t have a Plan B for Middle Eastern energy. That’s not a criticism — it’s just a simple fact. For decades, the implicit Plan B was the American security guarantee. The U.S. Navy kept the sea lanes open, and everyone could afford to pretend that their energy dependency wasn’t as dangerous as it looked. But the sea lanes are no longer open. It turns out the security guarantee had fine print that nobody read carefully enough.
What you do when your Plan B evaporates is you fall back on what actually works. What’s available. What doesn’t require permission from anyone to access. And for most of Asia — and a good chunk of Europe — that means coal. It’s not glamorous. It was never supposed to be part of the story they were telling. But coal is there — abundant, proven, shippable on routes that don’t run through anyone’s missile range. When the choice is coal or cold, people choose coal. That’s why demand never fell the way the models said it would.
And it’s why, now that the vulnerability is impossible to ignore, the countries that matter most for global energy demand are making decisions that will outlast this crisis by decades. When a country genuinely stares into the abyss of energy vulnerability — when the lights flicker and the reserves start counting down — attention is drawn back to coal. As well as nuclear, of course. Japan, South Korea, India are not going back to the comfortable fiction that the shipping lanes will always be open. They’ll burn more coal, build more coal capacity, and lock in longer-term supply agreements with producers who ship on low-risk Pacific routes. And they’ll do this regardless of what gets said at the next climate summit, because physics and economics have a way of winning arguments against ideology.
Hormuz didn’t create the coal story. It’s just drawing attention to it.
In this month’s issue, we have two ways to play this — one for readers who want broad exposure to the sector, another for those comfortable sitting at a higher-stakes table. Lau gets into the specifics below.
Regards,
Doug Casey
Recommendation
Hi,
Lau here.
Doug has set out the macro case — a contrarian thesis he’s been holding for years, finally getting the catalyst it needed. The practical question — which names, why now, and at what price — is what follows.