NEW YORK (AP) â¿¿ Shares of coal miners Patriot Coal and James River Coal traded higher Thursday, continuing a rally in the sector.

The stocks have done well this week, after struggling for most of 2012. On Wednesday, the energy market data firm Argus Media said mining costs for Australian companies have been surging. That could be good news for U.S.-based companies because Australian companies might have to cut back on production. On Tuesday, a Bloomberg News story pointed out a positive for the sector: coal use in Europe is at its highest levels since the mid-2000s because of rising imports and steep price cuts.

Coal stocks have suffered recently because more power plants are switching to using cheap natural gas to generate electricity. The stocks began to bounce back in late June, as analysts said the steep discounts and greater sales overseas might help.

Shares of Patriot Coal Corp. were especially strong, rising 42 cents, or 22.8 percent, to close at $2.26. The gain came on top of a 33.3 percent advance Tuesday. The surge does not reflect any major news for the company.

Shares of James River Coal Co. added 49 cents, or 15.6 percent, to end at $3.63. That's on top of a 10 percent gain on Tuesday.

James River also had no big news. Both Patriot and James River have a large number of shares shorted, or held by investors trying to make a profit by betting that the price will fall. That fact has prompted speculation that their rallies have been driven by those investors selling the stocks to cover their bets.

Larger coal producer stocks rose earlier in Thursday's session, but turned slightly negative by the end of trading. Alpha Natural Resources Inc. shares gave up 5 cents to close at $9.27. Consol Energy Inc. stock declined 3 cents to $31.16, while Peabody Energy Corp. shares slid 8 cents to $26.13 and shares of Arch Coal Inc. lost 9 cents to $7.27.

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