Colombia's Coal Restrictions on Israel over Gaza Conflict

Colombia's trade ministry is considering limiting the country's coal sales to Israel in response to the ongoing armed conflict in Gaza. The proposed measure aims to "help end the violence" and would remain in force until the conflict has ended.

While renewables and natural gas have been gaining market share, thermal coal still represents a significant source of electricity generation in Israel, accounting for over 20% of the country's power mix.

However, DBX believes the proposed coal restrictions will have a limited impact on Israel's energy supply. The country can easily replace Colombian coal with imports from Russia and South Africa. Russian coal, in particular, offers a shorter and more cost-effective shipping route, and it trades at a discount compared to other origins due to the US sanctions.

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