This newsletter was published 25.09.2024 at 17:47pm CEST

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

The third option expiry of the year offered no major surprises, as prices gravitated towards 65 EUR for several weeks. Despite significant open interest in 65 puts, the market did not test that level before the settlement window. Fundamentals remain stable, however, there appears to be some disconnect between EUAs and TTF gas prices recently. Carbon prices remain range-bound, but a large short position held by investment funds may have some bullish impact if those participants decide to decrease their exposure. The weekly CoT report showed no significant changes in positioning, with approximately 20 million tonnes still short. Although there was some selling pressure in September, late compliance buying might have provided support, preventing a more significant price drop. UKAs, on the other hand, experienced a notable dip following the latest auction. Investment funds have maintained a more bullish stance, holding a net long position of nearly 8 million tonnes of UK allowances. Other markets within the European energy complex have been quite bullish. Front-month TTF is trading above 37 EUR per MWh, while front-month German power futures are just shy of 80 EUR per MWh.

German power prices are up by 0.16 EUR since last week, with the front-year contract trading at 86.16 EUR/MWh. API2 coal prices are up by 3.75 USD since last week, with the Cal-25 contract trading at 118.75 USD/tonne. Front-year gas prices are up by 0.095 EUR since last week, with the TTF Cal-25 trading at 37.570 EUR/MWh. EUR/USD is up by 30 points since last week and is currently trading at 1.1150.

Price development of EUA Dec2024 futures contract