Emissions Trading / Carbon Market News (07/03/2022)

Ladies and gentlemen,

With the war in Ukraine, Putin is showing the West how powerless it is, since NATO intervention in the war would undoubtedly lead to a further escalation, in which the use of nuclear weapons cannot be ruled out.

What is particularly absurd, however, is the fact that Europe, and above all Germany, has made itself dependent on Russian natural gas and oil with its current energy policy. With every third litre of petrol, diesel or heating oil and with every second cubic meter of natural gas, we help finance the warmongers.

A radical change in energy policy is therefore required to prevent such toxic dependencies. And this can only be done through the further expansion of renewable energies, which at the same time achieves the decarbonization of the economy and society.

But the war in Ukraine has not only raised the prices of energy over the past week, but also of all other commodities, not least food and metals, which is driving up inflation accordingly.

Exactly the opposite effect was seen in the emission allowances last week, which showed the largest slump ever recorded. While the December contract was still showing an opening price of EUR 95.00 per EUA when the war began on February 24, 2022, the price slipped to a low of EUR 55.00 last Wednesday, which corresponds to a loss of 42%. By the end of the week, prices stabilized above the EUR 60 mark and closed at above EUR 65 last Friday.

The main reasons for the sharp decline were institutional investors and energy companies, which had to obtain liquidity through the sales, and technical sales were also triggered by the crash.

Since no one can currently predict with certainty how the situation in Ukraine will develop this week, high volatility on the commodity and energy markets and in emission certificates can be expected in the coming days. This morning, the quote for EUAs is still under pressure and just above 60-Euro-mark.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)87.74 EUR65.48 EUR-22.26 EUR
EUA (December-2022-Future)88.14 EUR65.10 EUR-23.04 EUR
VCU (Voluntary Carbon Units ø)9.44 USD5.45 USD-3.99 USD
VER (Gold Standard Spotmarkt ø)10.27 USD9.84 USD-0.44 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)94.40 USD118.03 USD+23.63 USD
EURO (Currency, Forex)1.1272 USD1.0931 USD-0.0341 USD

(The average exchange quotes and OTC-prices shows the average between bids and ask of several exchanges and OTC markets for carbon emission rights in the ETS. Bid and ask has usually in Spot Market a visible spread. VCUs and VERs are average prices (CBL markets). Crude Oil and Euro Currency shows day-end-exchange quotes. This market information has just an informational character and are no advice or offer to trade carbon emission rights or their futures and options. If you want to unsubscribe, please reply to this mail.)

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With kind regards,

Advantag Services GmbH