Coal prices are at record highs amid the looming global energy crisis and market watchers believe prices still have more to go. The clean energy transition is expected to herald the demise of coal – the most polluting of all fossil fuels. Instead, the price of thermal coal used for power generation has nearly tripled since the beginning of the year. The global push to limit carbon emissions has hit a snag as governments scramble to secure their energy needs amid supply bottlenecks caused by the Ukraine war. Russia’s cutoff of gas supplies to Europe has also forced the bloc to look for alternative fuels ahead of the cold winter months – including coal from Australia. According to Peter O’Conner, senior analyst at Sydney-based investment firm Shaw & Partners, investors should buy coal-related stocks to make money when demand explodes. “Global coal stocks will do well, and the breeze they’ve had from their June 2020 lows will continue to be high. The money they’ve generated is phenomenal,” he said. “It’s almost like any or all companies are buying.” His favorite stock pick in Australia is coal producer Whitehaven. Read more Wall Street expert predicts when the S&P 500 will recover – and reveals how to trade Tesla or Rivian? Analyst size them up and give them 190% gain Positioning for a ‘bullish shock’ to the oil market? Here are a strategist’s top stocks to make money on. It also generated AU$2.6 billion ($1.79 billion) in cash from its operations during the period, a huge increase from the $169.5 million generated in 2016. before. “Whitehaven could effectively buy back almost 10% of its company per month per month at the moment, given the amount of cash the company is generating,” O’Conner said. The company also pays good dividends. Whitehaven has a dividend yield of 7.4%, significantly higher than the industry average of 3.5%, according to FactSet data. To be sure, there may be a short-term upside limit to the stock following a spike this year. The company’s shares hit a 52-week high of AU$8.74 last week, giving the stock a roughly 220% gain since the start of the year. But it’s still a favorite among analysts, FactSet data shows, with a buy-in rate of the stock of 71%. Meanwhile, Kenny Polcari, chief market strategist at Slatestone Wealth, calls US coal miner Peabody Energy a favorite in the sector. The Missouri-based company has also benefited from soaring coal prices this year, and its stock is up more than 100% since the start of 2022. Coal prices skyrocketed Meanwhile, coal prices seem to remain high for the foreseeable future. Spot physical coal loaded at the port of Newcastle in Australia was priced at $441.19 a tonne on Monday, trading at an all-time high, according to Eikon data. Coal futures prices are also trending higher. Eikon data showed Newcastle coal October contracts priced at $430.60 on Friday, after hitting an all-time high last week. Data aggregator Trading Economics forecasts coal prices to trade at $461.49 by the end of September, before rising to $551.06 in 12 months. O’Connor also expects coal prices to stay higher in the long run. “With low hydroelectricity production and very high energy prices in Europe, coal prices will be higher…if [coal price] It’s still above $425/ton… It’s a breakout of the mid-term chart position, very important, which should drive trading higher,” he told CNBC’s “Street Signs Asia” on Friday.