Connect with us

Hi, what are you looking for?

Stock

Emerging-market energy transition likely to take time

Investing.com — While North America and Europe have been reducing their reliance on coal for decades, emerging markets are still heavily dependent on it, note analysts at Wells Fargo (NYSE:WFC). 

The bank said in a memo this week that China and India, now the world’s largest coal consumers, have seen their consumption surge, even as Western economies pivot toward renewable energy. 

Since 2005, coal use in North America and Europe has halved, while India’s has nearly tripled. Together, China, India, and Southeast Asia now represent roughly 75% of global coal demand, a stark increase from 25% in 1990.

“Coal, despite its environmental drawbacks, continues to be a prevalent energy source in large parts of the world,” Wells Fargo analysts wrote, pointing out that affordable and reliable fuel sources are essential to support economic growth in emerging markets. 

For example, coal represents 53% of China’s domestic power consumption, according to Energy Institute data. Although China has started investing in green energy, Wells Fargo predicts this shift will take time before renewable sources become dominant.

The analysts acknowledged that while the future is moving toward greener fuels, the global energy transition will likely create investment opportunities that still involve hydrocarbons. 

“We expect fossil fuels to remain the predominant source of energy for many emerging economies,” they explained. 

Wells Fargo feels that as demand continues in these markets, it is likely to support higher prices for petroleum and natural gas, further bolstering investments in these sectors.

 

This post appeared first on investing.com

Enter Your Information Below To Receive Free Trading Ideas, Latest News And Articles.






    Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

    You May Also Like

    Editor's Pick

    Former president Donald Trump and his allies have filed hundreds of lawsuits, with more to come, seeking to tighten voting rules or disqualify voters....

    Economy

    LONDON (Reuters) – Bank of England interest rate-setter Megan Greene said she still believed the central bank should take a cautious approach to cutting...

    Editor's Pick

    Sister Stephanie Schmidt had a hunch about what her fellow nuns would discuss over dinner at their Erie, Pennsylvania, monastery on Wednesday night. The...

    Latest News

    Warner Bros. Discovery said Thursday its streaming platform Max added 7.2 million global subscribers in the third quarter. It marked the biggest quarterly growth for...

    Disclaimer: beneficialinvestmentnow.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.


    Copyright © 2024 beneficialinvestmentnow.com