This newsletter was published 18.6.2025 at 16:58pm CEST

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

One week before the second quarterly option expiry of the year, EUA prices appear to be pinned at 75 EUR for the December 2025 futures contract. Despite open interest of nearly 10 million allowances at the 75 EUR strike, there were some upward deviations over the past week, most likely due to geopolitical tensions between Israel and Iran. These tensions have increased the risk of LNG shipping routes from Qatar being disrupted, leading to a noticeable spike in TTF gas prices. The July 2025 futures contract rose above 40 EUR per MWh without showing any real signs of weakness, while German power futures for the 2026 calendar year remain firmly above 90 EUR per MWh. Carbon prices spiked as high as 76.75 EUR for the December 2025 contract but have since eased slightly, diverging from both related markets. The weekly CoT report confirmed signs of strength in the market, with much of it driven by accumulation from investment funds. There was a week-on-week increase in net length of 5.4 million tonnes, bringing the total net long position to nearly 30 million tonnes. Several factors could be contributing to this accumulation, including ongoing tensions in the Middle East, the potential for a hot summer with limited precipitation, the upcoming option expiry, and a slightly reduced primary supply expected in September.

German power prices are up by 2.85 EUR since last week, with the front-year contract trading at 92.00 EUR/MWh. API2 coal prices are up by 6.50 USD since last week, with the Cal-26 contract trading at 111.75 USD/tonne. Front-year gas prices are up by 2.410 EUR since last week, with the TTF Cal-26 trading at 37.00 EUR/MWh. EUR/USD is up by 20 points since last week and is currently trading at 1.1500.

Price development of EUA Dec2025 futures contract