Goldman Sachs sees Indian coal worsening glut

NEW YORK: Slumping global coal and liquefied natural gas prices will be under further pressure as rising Indian coal production exacerbates a glut of power-generation fuel, according to Goldman Sachs Group.

The prospect of higher output from India, which is forecast to overtake China as the world’s largest importer of thermal coal, will likely cause a 10% contraction in seaborne trade of the fuel by 2020, the bank’s analysts including Christian Lelong wrote in a report dated February 15.

The oversupply of coal and gas and weakening electricity demand prompted Goldman to lower its price forecasts for thermal coal and spot liquefied natural gas in east Asia and Europe for the next three years.