US coal miners are gearing up to boost exports as the Iran crisis rattles energy markets, but soaring production and transport costs are complicating their ability to ship more tonnes.

The blockage in the Strait of Hormuz has boosted demand for coal in European and Asian markets, which are increasing their use of coal-fired power plants.

US coal producers see the crisis as an opportunity to boost sales and push into international markets but rising fuel costs are complicating their efforts.

“It’s frustrating,” said Jimmy Brock, chief executive of Core Natural Resources and vice-chair of President Donald Trump’s newly reformed National Coal Council. “Diesel plays a tremendous part in our costs, and because of the crisis the price just keeps rising.”

Trump has made supporting the industry and boosting US exports a key pillar of his presidency, issuing an executive order in April to “reinvigorate America’s beautiful clean coal”, and “promote and identify export opportunities” for the sector.

However, the trade war with China hit the industry hard, with exports dropping 18 per cent in 2025 because of Chinese tariffs imposed in response to Trump’s trade war.

The crisis in Iran could be a golden opportunity for the industry to boost its international sales and make up lost ground.

Brock said he expected the company’s exports to rise 10 per cent this year and that it was taking orders not only from typical coal importers, including India and China, but also from “surprise markets” such as Indonesia and Vietnam.

But he added that US producers were at a geographical disadvantage relative to producers that are closer to Asian markets, making them much more vulnerable to rising transportation costs.

“Someone who’s mining in Australia can get the coal there quicker and cheaper than us,” he said.

Coal producers are heavily reliant on diesel-powered machinery, as well as trucks, trains and barges used to move their coal from mines to utility customers and ports for export.

Diesel costs account for as much as 25 per cent of surface miners’ costs, and 12 per cent of underground operations, say analysts at Bank of America.

According to data from the US Energy Information Administration, the price of diesel for trucks has risen 48 per cent since the Iran war began.

Meanwhile, the cost of moving coal by rail from industry hotspots Appalachia and Pittsburgh to export hubs on the East Coast will rise by more than 4 per cent in May, according to estimates from Argus, while transport costs to domestic markets such as Florida and Tennessee are up 8 per cent.

The cost of shipping from North America to China is up by as much as 55 per cent, according to Bank of America.

Some US producers with overseas operations have managed to benefit from the crisis, including Peabody, which ships coal to Asia from its Australian mines.

Chief executive Jim Grech told the FT the company was experiencing “stronger demand and pricing” for its exports, “given the scarcity and soaring prices” of liquefied natural gas in Asia.

Newcastle coal, the benchmark for Australian coal typically shipped to Asian markets, has risen 22 per cent since the conflict started.

However, analysts said the crisis was unlikely to help much with the company’s decade-long attempt to boost its US export business.

US prices have risen but not sufficiently to spur more production, so companies that are already locked into supply contracts will have little excess to send overseas.

“There’s this tug of war between domestic coal use and exports,” said Tony Knutson, head of thermal coal research at consultancy Wood Mackenzie. “It’s difficult to change mine plans by getting more crews on or increasing equipment hours to increase production, it doesn’t happen overnight.”

US coal producers’ prospects could slip away further if the Strait of Hormuz opens and the price of natural gas comes down, said Andy Blumenfeld, a coal analyst at McCloskey by OPIS, pointing to the fall in natural gas and coal prices in Europe after the two-week ceasefire was announced earlier this month.

However, the crisis could still boost overall demand and buoy US exports, as the uncertainty of the negotiations between the US, Iran and Israel leads utilities and governments to reassess the risk of relying on “uncertain oil and natural gas supplies”.

“The primary premise holds as the Strait of Hormuz remains closed,” he said, adding that “the war has highlighted the risks of depending on critical supplies from the Persian Gulf”, which is “likely to have a lasting effect”.

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