This newsletter was published 16.8.2023 at 16:02pm CEST

The current prices on the European carbon market are as follows:

EUAs are eyeing 90 EUR mark again, after strong bullish trend started last week. Halved auctions and warmer weather forecast for Europe have pushed prices to two-week high, reached today, just after Polish auction. Strong clearing price was aligned with increased net short position of investment funds, according to CoT report, which sparked the buying activity. Surprisingly, net short position of investment funds has increased by almost five million tonnes in comparison to last week, which could result in more price sensitive market, especially to the upside. This has to some extent manifested today when buyers stepped in and pushed the market to 88.83 EUR per tonne, before it reverted. It seems, however, that EUA is comfortable trading at current range between 85 and 90 EUR, with buyers and sellers in balance. Some more action during past week could be observed in gas and power markets. German base power futures for the year 2024 broke out of a technical structure at 137.90 EUR and traded as high as 146 EUR per MWh, highest price since late July. The move might have been caused by rally in gas prices, mainly due to supply concerns.

German power prices are up by 4.24 EUR since last week, with the front year contract trading at 142.24 EUR/MWh. API2 coal prices are down by 3.00 USD since last week, with the Cal-24 contract trading at 127.00 USD/tonne. Front year gas prices are up by 2.900 EUR since last week, with the TTF Cal-24 trading at 55.300 EUR/MWh. EUR/USD is down by 60 points since last week and is currently trading 1.0920.

Price development of EUA Dec2023 futures contract