Emissions Trading / Carbon Market News (08/08/2021)

Dear Sir or Madam,

You can now see it clearly in the development of energy prices for German private households – energy costs are currently higher than they have been in 10 years. According to the comparison portal Verivox, prices have increased by almost 7% compared to December 2020.

Heating oil was right at the top of the list with an increase of 12%, closely followed by diesel with an average increase of 11.2% and gasoline was still just under 10%.

In addition to the increased exchange prices for crude oil, the national emissions trading in Germany is also a reason for the rise in energy prices and the EU’s CO2 emissions trading.

Last week, the prices in European emissions trading increased significantly by almost 16% to 38.20 euros and the start of the new trading week was still clearly bullish with a current new all-time high of 39.80 euros. All in all, prices have increased by around 60% since November 2020.

In addition to the already mentioned higher crude oil prices, which this morning cracked the 60 US dollar mark for Brent crude oil, the cold snap is another price driver for CO2 emission rights.

Market observers and analysts are currently in the process of adapting their forecasts of price developments to current market developments. An analyst for an oil hedge fund even brought up the € 100 mark that prices could reach this year, as Bloomberg wrote. The market also took this visibly bullish last week.

Most other market participants, however, are not quite as optimistic and tend to expect highs between 40 and 50 euros. From a purely chart-technical point of view, a price correction to the range of 35 euros for EUAs would currently be a common reaction, insofar as market participants with larger positions decide to take profits or large system operators delay their purchase decisions more and more. A correction – possibly after reaching the EUR 40 mark – could only be short-lived, as buyers would probably use this level for purchases again.

This week, the normal auction volume of 15,091,500 EUA will again be auctioned on all five trading days at the Leipzig EEX; It should remain exciting to see how strong the demand from market participants will be and whether auctions will be closed again well above the market price, as happened last week.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)34.15 EUR32.88 EUR-1.27 EUR
EUA (December-2021-Future)34.24 EUR32.95 EUR-1.29 EUR
CER (Spot-Market)0.36 EUR0.35 EUR-0.01 EUR
ICE Brent Crude Oil (Benchmark Future)55.18 USD55.03 USD-0.15 USD
EURO (Currency, Forex)1.2173 USD1.2136 USD-0.0037 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. CER CP1 and ERU are eligible in ETS until end of March 2015 and must be swapped into EUA. 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.)

Please call our international carbon desk if any further questions exist: +49.2831.1348220.

With kind regards,

Advantag Services GmbH