Emissions Trading / Carbon Market News (2018-10-15)

Dear Sir or Madam,

Yesterday, the United Kingdom and the EU wanted to clear the main outstanding issues in Brexit at a meeting of negotiators, before the progresses on Wednesday at the EU summit should be discussed. But the talks were broken off without result. The main disputed point was once more the necessary border regulation between Northern Ireland and the EU member Ireland, above all because of the fear of a resurgence of the old Ireland conflict. Time is short, because there are not six months left until the official exit date.

In case of the failure of the negotiations, the UK Government has recently clarified that Britain will leave the ETS, the European Emissions Trading Scheme, by the end of March 2019. What this will mean for the carbon market is not yet clear, especially as British companies are considering the possibility of opening register accounts in mainland Europe in order to continue trading in pollution rights.

Last weekend, a series of temperature records were broken again. The peak in Germany was officially 29.7 degrees measured on Saturday – and that middle of October! But not the heat in Europe, but the catastrophic weather events in his country, the recent denier of climate change, US President Donald Trump, now apparently showed a kind of rethinking. After all, he admits that something is changing, even though he does not believe that this change is man-made and that urgent action is needed to prevent even worse catastrophes. He definitely does not want to invest billions and endanger thousands of jobs, Trump said in a recent interview. But that he admits the existence of a climate change at all, is already a small sensation.

Quite different the situation at our Polish neighbors. The country is dependent on coal burning for around 85 percent of its energy needs, and the government clearly has no plans to change that. While the skyrocketing carbon price elsewhere leads to market-driven consequences, the ruling PiS cuts subsidies for renewable energy and instead prepares compensation for companies and households. It will be interesting to see when pressure from the polish people finally sets in, as the so-called winter smog is becoming more unbearable from year to year there.

The CO2 market remained highly volatile during the past trading week. Within just a few days, the highly speculative market bridged a price range of around four euros and stopped at last near 18.30 euros. Recently, however, the price stabilized again above the 20-euro mark.


(Average Quotes Exchange / OTC)      
Instrument 2018-10-05 2018-10-12 Change
EUA (Spotmarket) 22.09 EUR 20.35 EUR -1.74 EUR
EUA (December-2018-Future) 22.16 EUR 20.39 EUR -1.77 EUR
CER (Spotmarket) 0.28 EUR 0.28 EUR +0.00 EUR
ICE Brent Crude Oil (Benchmark Future) 84.12 USD 81.53 USD -2.59 USD
EURO (Currency, Forex) 1.1522 USD 1.1576 USD +0.0054 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 or +44.20.79790283.


With kind regards,

Advantag Services GmbH