This newsletter was published 21.1.2026 at 16:03pm CEST

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

After EUAs breached the 90 EUR level and consolidated above it at the start of the year, prices came under heavy pressure amid rising geopolitical risk. The December 2026 futures contract peaked at 93.80 EUR on Thursday, but the rally quickly lost momentum, with prices closing well below the intraday high. Sellers outnumbered the buyers again on Friday afternoon and continued into Monday morning following a broader risk-off move over the weekend. The downside move was amplified by what appears to have been an overcrowded long positioning among investment funds. As sentiment deteriorated, long liquidation accelerated, pushing the December 2026 contract to a low of 83.52 EUR. This more than 10 EUR decline in just three trading days highlights the current vulnerability of EUAs to downside risk, despite supportive fundamentals across the wider energy complex. According to the latest CoT report, investment funds still hold a net long position exceeding 126 million EUAs. While some of this exposure was likely reduced during the sell-off, positioning remains elevated and could continue to contribute to volatility should risk sentiment worsen again. In contrast, natural gas and front-month power futures have shown relative resilience, remaining close to Friday’s closing levels. This divergence suggests that the recent weakness in EUAs has been driven primarily by financial positioning and risk sentiment rather than a deterioration in underlying energy market fundamentals. Despite the price pressure, primary market demand remains healthy. Daily EUA auctions have been well absorbed, with today’s Polish auction clearing in line with the prevailing spot prices.

German power prices are down by 0.32 EUR since last week, with the front-year contract trading at 86.05 EUR/MWh. API2 coal prices are up by 0.50 USD since last week, with the Cal-27 contract trading at 95.50 USD/tonne. Front-year gas prices are up by 1.625 EUR since last week, with the TTF Cal-26 trading at 26.565 EUR/MWh. EUR/USD up by 80 points since last week and is currently trading at 1.1730.

Price development of EUA Dec2026 futures contract