This newsletter was published 5.6.2024 at 16:48pm CEST

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

Carbon has been falling heavily since the spike towards 78 EUR per EUA on Monday, following the MSR news and an unplanned 80 mcm per day gas outage from Norway. The European Commission reported a withdrawal of 267 million allowances from the market between September 1st, 2024, and August 31st, 2025. Even though the figure aligned with expectations, it surprised some participants, which might have caused heavy buying on Monday morning. The market rose by more than 3 EUR from the open; however, the buying subdued in the afternoon hours. Sellers stepped in aggressively, which caused the market to sell off by almost 10 percent from the Monday high. Bigger downward corrections could also be observed in the German power and Dutch gas markets. The selling pressure could have been caused by more clarity regarding the gas outage, as the TSO said that the issue will likely be resolved by the end of this week. Despite the outage, the levels of underground gas storages have been consistently rising, according to AGSI (Aggregated Gas Storage Inventory). Mild weather conditions across Europe are not pressuring the supply side too much, and it looks like the market could remain balanced in the following weeks. However, the second quarterly option expiry of the year is just around the corner, and it could cause some additional volatility in the EUAs due to rising open interest at rounded levels near the current market price.

German power prices are down by 4.90 EUR since last week, with the front year contract trading at 92.85 EUR/MWh. API2 coal prices are up by 2.00 USD since last week, with the Cal-25 contract trading at 123.00 USD/tonne. Front year gas prices are down by 1.950 EUR since last week, with the TTF Cal-25 trading at 35.900 EUR/MWh. EUR/USD is up by 65 points since last week and is currently trading 1.0880.

Price development of EUA Dec2024 futures contract