This newsletter was published 11.09.2024 at 17:15pm CEST

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

The energy market is showing signs of stabilization following a recent selloff, with EUAs finding strong support around the 65 EUR level. This level is particularly significant due to the large open interest tied to the upcoming quarterly options expiry. Out of 17 million allowances of open interest at this level, nearly 15 million are put options, which may help explain the recent market movements. Following the retracement, there has been some improvement in power, EUAs, and gas prices, partly due to the slightly prolonged gas maintenance in Norway and increased compliance buying ahead of the upcoming deadline in two weeks. Although the ongoing maintenance of Norwegian gas infrastructure has added some bullish pressure to the market, overall supply appears to be abundant, at least in the short term. European underground storage facilities are more than 93 percent full, providing a cushion as the colder months approach. According to the latest CoT report, net short positions have increased by roughly 8 million tonnes week-on-week, which may have contributed to the nearly 5 EUR drop in EUAs. Despite the recent price decline, daily auctions have continued to clear strong. None of them have offered substantial discounts and most have cleared at a premium to the secondary market, which is typically a sign of market strength. UK emission allowances remain firm, trading above 42 GBP per tonne, with investment funds maintaining a bullish stance.

German power prices are down by 1.75 EUR since last week, with the front-year contract trading at 88.15 EUR/MWh. API2 coal prices are down by 1.75 USD since last week, with the Cal-25 contract trading at 116.25 USD/tonne. Front-year gas prices are down by 0.605 EUR since last week, with the TTF Cal-25 trading at 37.590 EUR/MWh. EUR/USD is down by 85 points since last week and is currently trading at 1.1000.

Price development of EUA Dec2024 futures contract