This newsletter was published 11.6.2025 at 16:49pm CEST

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

A month-long trading range has finally broken to the upside, driven by supportive fundamentals, most notably relatively low hydroelectric output and an anticipated drop in wind power generation. EUAs have consistently found strong support at around 72 EUR per tonne, while notable selling pressure emerged as prices approach the 75 EUR level. This resistance could be attributed to a combination of profit-taking by investment funds and increased options-related activity. The latest CoT report showed a significant increase in net length, as investment funds both added to their long positions and trimmed their shorts. In total, this resulted in nearly 6 million tonnes of additional net length on a weekly basis. This shift may also help explain the strong auction clearings, despite relatively modest cover ratios. While the recent rally appears fundamentally driven, particularly by strength in the power markets, the key question is whether the current momentum is sufficient to push prices higher. Options data and open interest at the 65 EUR and 75 EUR strike levels suggest the market may be inclined to trade within this range in the near term. The 65 EUR strike holds the largest put open interest, at nearly 11 million EUAs, while the 75 EUR strike remains the most prominent call level. Other markets in the European energy complex, remain well supported also. Benchmark German power futures for calendar year 2026 continue to trade just below the important 90 EUR per MWh resistance, while front-month TTF gas trades confidently above 35 EUR per MWh.

German power prices are up by 1.70 EUR since last week, with the front-year contract trading at 89.15 EUR/MWh. API2 coal prices are up by 1.50 USD since last week, with the Cal-26 contract trading at 105.25 USD/tonne. Front-year gas prices are up by 0.305 EUR since last week, with the TTF Cal-26 trading at 34.590 EUR/MWh. EUR/USD is up by 50 points since last week and is currently trading at 1.1480.

Price development of EUA Dec2025 futures contract