This newsletter was published 14.08.2024 at 16:49pm CEST

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

Major moving averages have been confidently broken to the upside, as EUAs find a consistent bid above 70 EUR per tonne for the December 2024 futures contract. It seems that sentiment has firmly shifted to the bullish side, with investment funds continuing to decrease net short exposure in a low-volatility and low-liquidity environment, six weeks before the compliance deadline. Today’s option expiry for the August 2024 options offered no surprises, with the contract settling at 71.70 EUR. On the other hand, option activity for September has been robust. While the first two quarterly expiries offered no surprises and were pinned at the lower strikes, the upcoming one might be more eventful. Although the largest open interest is at the 60 EUR strike, the 75 EUR strike is not far behind. Moreover, the 80 EUR strike has more than 7 million allowances of open interest, while the 90 EUR strike has over 13 million. If the market begins to make higher highs and approaches these significant levels, these rounded numbers could exert additional pressure. Interestingly, front-month and especially Calendar 2025 gas prices have been well-supported in recent weeks. Despite relatively full underground storage, TTF gas futures for September are trading around 40 EUR per MWh. Alongside gas, power has also seen some activity. Benchmark German power futures have traded above 100 EUR per MWh and are currently trading steadily just below that level.

German power prices are up by 3.05 EUR since last week, with the front-year contract trading at 99.15 EUR/MWh. API2 coal prices are up by 4.75 USD since last week, with the Cal-25 contract trading at 129.75 USD/tonne. Front-year gas prices are up by 1.580 EUR since last week, with the TTF Cal-25 trading at 41.930 EUR/MWh. EUR/USD is up by 100 points since last week and is currently trading at 1.1030.

Price development of EUA Dec2024 futures contract