As July comes to a close, the unexpected price rally appears to have come to an end. Prices fell by 21 cents (6%) last week, finally living up to our weekly refrain that they would revert to the 5 €/t level, closing at 5.09 €/t by Friday’s close. However, this does not disguise the fact that EUA..
EUA prices remained sticky above the levels we expected. While little of fundamental note occurred, Brexit issues, always a good source of hyperbole, reared their head. The media has started to recognise that Brexit is likely to be problematic for EUA trade if there is no early notice of what mig..
Last week’s G20 meeting in Hamburg was most notable for the divergence on climate policy between the US and the rest of the group. Extraordinarily, the summit-ending communique noted the US withdrawal from the Paris Agreement (PA), but saw the remaining 19 nations reaffirm that an ‘irreversible’..
Last week saw little progress on finalising the post-2020 ETS legislation, with the European Council and the European Parliament remaining divided on a number of points. Interestingly, the two sides reportedly agree on those points that are more bullish for prices, meaning that raising the MSR in..
Prices were less volatile in June than they had been in May, with EUA prices trading in a tight range around 5 €/t, though this was a month of two halves in terms of primary supply. The first half, when auction volumes averaged a fairly low 15 Mt per week, and the second half, with weekly volume..
This week starts with Monday’s important vote in the European Council on the post-2020 revisions to the Energy Efficiency Directive (EED). The initial EC proposals included a 24% saving by 2030 on ‘business-as-usual’ (BAU) emissions—a target that even at the time looked very weak as the 2020 targ..
The publication of the BP statistical review of world energy always presents a good opportunity to measure how decarbonisation is progressing. The answer is that the world is doing better, but there is still a way to go before fossil fuel demand peaks. The data for 2016 show that primary energy c..
Last week was dominated by a UK election that saw a left-wing Labour party do far better than expected at the start of the election, while the incumbent Conservative party lost its overall majority. With the Conservatives now trying to form a government, what does this mean for the Brexit talks a..
Last week, climate policy discussions were dominated by President Trump’s announcement that he was withdrawing the US from the 2015 Paris Agreement on climate change. While the decision was met with general global dismay, it is not the end of the deal and it is highly unlikely that any of the agr..
In May, EUA prices traded with some added volatility. The first half of the month was largely bearish, with prices falling and showing some reversion around the 4.5 €/t level. Prices were looking soft and fundamentals were providing little in the way of direction. While the market started to tes..
Last week saw a continuation of the counter-trend uptick in EUA prices, as a holiday-disrupted week meant auction volumes were down at 13.3 Mt—the lowest weekly total seen this year so far. EUAs closed on Friday 7% higher w/w at 5.19 €/t and there was little movement on Monday. In the last two we..
Next week's edition of Panorama will be published on Tuesday 30 May, owing to the UK bank holiday. Last week’s price action was very much against the recent trend, with EUAs closing on Friday up by 8.7% w/w at 4.83 €/t. Given that the fundamentals had become less supportive—temperatures were sig..
On Friday, the European Commission (EC) officially estimated the number of ‘surplus’ allowances in circulation in the EU ETS at the end of the 2016 compliance cycle is 1.69 Gt. The number is a preliminary estimate of the base numbers on which the Market Stability Reserve (MSR) will operate. The M..
Last week saw the EU ETS market hit a number of 2017 lows, closing as low as 4.4 €/t at one point, but then recover somewhat to end the week largely unchanged at 4.58 €/t. This behaviour has been a persistent market trend of the last few months, with prices registering sharp drops, a slight bounc..
The EU ETS market ended April on the soft side, with EUAs unchanged w/w at 4.57 €/t but 30 cents lower (6%) than at the start of the month. This softness underlines the big impact that auctions are having this year, particularly since April often sees some last-minute compliance buying that helps..