Emissions Trading / Carbon Market News (09/12/2019)

Dear Sir or Madam,

Germany was one of the countries most severely affected by climate change in the past year. Consequently, the Federal Environment Agency recently issued a very detailed statement on the climate change in transport and emphasized the term “reduction gap”. The report shows that even if the measures and instruments adopted so far are implemented, the reduction target for greenhouse gas emissions by 2030 will be missed by far. In order to close this reduction gap, the Federal Environment Agency recommends numerous measures. These include, among other things, a quota of 70% for new registrations of electric vehicles and a higher taxation of vehicles with high CO2 emissions as well as for diesel engines. In addition, several other correctives are proposed, such as the traveling allowance and the truck toll. Whether these will ever even be considered in the next years remains to be doubted, so that we should get used to the concept of the reduction gap already now. Perhaps it will soon be the sad “word of the year”.

In the first week of December, European emissions trading was under pressure from a high auction volume of fresh allowances and a simultaneous sharp dip in oil prices. In the week now beginning, the number of EUAs to be auctioned is again more moderate and the oil price has also shot up significantly since Friday, because the group of OPEC states and other players agreed after long negotiations on a sharper production cut than expected. In the coming months, the 24 countries want to pump 500,000 barrels of oil out of the ground less per day than at present. The so-called OPEC+, with its heavyweights Saudi Arabia and Russia, has already been trying more or less successfully for three years to influence the oil price with such production limits.

  (Average Quotes Exchange / OTC)      
Instrument 29/11/2019 06/12/2019 Change
EUA (Spotmarket) 25.12 EUR 24.88 EUR -0.24 EUR
EUA (December-2019-Future) 25.22 EUR 24.94 EUR -0.28 EUR
CER (Spotmarket) 0.18 EUR 0.18 EUR +0.00 EUR
ICE Brent Crude Oil (Benchmark Future) 60.76 USD 64.34 USD +3.58 USD
EURO (Currency, Forex) 1.1017 USD 1.1055 USD +0.0038 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