Emissions Trading / Carbon Market News (28/11/2022)

Dear Madam or Sir,

The price of oil has come under massive pressure in the past few days, and at the same time the euro has visibly strengthened against the US dollar. This pleases consumers who heat with oil or drive vehicles powered by fossil fuels.

The reasons for this include high corona numbers in China and the ongoing zero-Covid strategy in China, which is leading to a large number of lockdowns. More than 410 million Chinese are currently affected by the lockdown, which corresponds to around a third of the population and a decline in Chinese economic output by a fifth. Not only does the manufacturing industry in the Far East suffer from this, but also the economy in all other parts of the world afterwards, as delivery bottlenecks are likely to increase again.

According to forecasts by the International Energy Agency IEA, demand for oil is even expected to fall from 2.1 million barrels a day to 1.6 million barrels a day in the coming year, which means a drop of 24%.

Despite this significant decline and the associated reduction in greenhouse gas emissions, European carbon emission allowances have been clearly bullish over the past week. EUAs gained 9% on a weekly closing basis and closed just below the EUR 79 mark.

In the coming trading week, with the exception of Wednesday, a total of 9,393,000 EUAs will be auctioned at the EEX.

In addition, it is now the penultimate week in which emission certificates in accordance with the German Fuel Emissions Trading Act can be obtained in Germany’s national emissions trading system.

We therefore ask our customers to calculate their needs promptly and to send us their purchase orders in order to be able to participate in the last four remaining fixed-price auctions this year at EEX Leipzig.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)72.36 EUR78.78 EUR+6.42 EUR
EUA (December-2022-Future)72.38 EUR78.86 EUR+6.48 EUR
VCU (Voluntary Carbon Units ø)5.48 USD5.43 USD-0.05 USD
VER (Gold Standard Spotmarkt ø)3.18 USD3.15 USD-0.03 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)87.85 USD83.81 USD-4.04 USD
EURO (Currency, Forex)1.0322 USD1.0395 USD+0.0073 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. The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. 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