Emissions Trading / Carbon Market News (26/04/2021)

Dear Sir or Madam,

The past week can rightly go down in the history books as historic with regards to global climate protection.

Business leaders who have previously classified climate protection as a nuisance and unnecessary matter will in future have the same fate as fossil fuels.

Last Wednesday, the decision-makers of the European Union manifested the reduction target of 55% greenhouse gas reductions compared to 1990 and thus described the roadmap for the next 30 years.

In 2030, the EU should not emit more than 255 million tons of CO2 or its equivalent in other greenhouse gases.

In addition to the ambitious 2030 reduction target, the European Commission is also to set a further interim target in 2040 by 2024. The goal of reducing CO2 emissions by 95% in 2050 could also give way to a net-zero strategy in the future.

As if that hadn’t already been enough for a very good week for climate protection, US President Joe Biden announced at the end of last week at the virtual climate protection meeting he had called that the USA, as the second largest greenhouse gas emitter, should become climate neutral by the middle of the century.

UN Secretary General António Guterres also demanded that fossil fuels should be phased out by 2030 and that CO2 should be priced worldwide, and China’s head of state Xi Jinping and Russian President Vladimir Putin also showed their willingness to cooperate. If the foundation stone for an ambitious joint action against global warming has been laid here, April 2021 may be the time that sealed decarbonization.

One week before the end of the submission deadline for companies subject to EU emissions trading, our predictions were fulfilled and the price for European Allowances (EUA) reached a new all-time high of EUR 47.36 per ton of CO2.

Anyone who has speculated that the certificates will give way again is now mistaken and has to pay a significantly higher price to meet his tax obligation; the prices rose again a good 6% compared to the previous week.

Whether and when the speculators will begin to take profits cannot be precisely predicted, but the stock market is not a one-way street and speculators also tend to liquidate parts of their positions at a profit. The coming trading days will therefore remain exciting.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)44.42 EUR46.90 EUR+2.48 EUR
EUA (December-2021-Future)44,33 EUR46.95 EUR+2.62 EUR
CER (Spot-Market)0.62 EUR0.63 EUR+0.01 EUR
ICE Brent Crude Oil (Benchmark Future)66.69 USD66.05 USD-0.64 USD
EURO (Currency, Forex)1.1980 USD1.2097 USD+0.0117 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. CERs CP2 are eligible in ETS until end of April 2021 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