EU Market: EUAs dip below €7 as further MSR talks loom

Published 16:46 on March 27, 2015  /  Last updated at 14:56 on May 11, 2016  /  EMEA, EU ETS  /  No Comments

EU carbon prices slid 2.6% on Friday as distant prospects for MSR reform and weak auction demand dented sentiment ahead of next week’s deadline for reporting 2014 emissions.

EU carbon prices slid 2.6% on Friday as distant prospects for MSR reform and weak auction demand dented sentiment ahead of next week’s deadline for reporting 2014 emissions.

The Dec-15 contract settled down 18 cents at €6.81, near the bottom of day’s €6.80-7.05 range.

The benchmark carbon contract fell 4.4% week-on-week to finish close to the bottom of the €6.77-7.29 trading range across the five sessions.

“We saw some progress on the MSR this week but lawmakers seem far from getting a final deal,” said one trader.

On Wednesday, member states agreed a common position they needed to kick off trilogue negotiations with the European Parliament and Commission on the supply-curbing measure.

The first trilogue meeting is scheduled for Monday, with negotiators pencilling in two more sessions for May 5 and May 28, an EU source said.

The first of the closed-door talks is unlikely to yield much progress and will involve envoys setting out their positions and future discussion points, he added.

Earlier in Friday’s session, prices dipped briefly following Germany’s auction, which attracted the lowest demand for an EEX-hosted sale this year.

Some 3.198 million spot EUAs cleared 3 cents below market at €6.90 with a bid-to-cover ratio of 1.58, well below the average of 3.6.

Traders reported little interest to trade from smaller regulated companies that rarely participate except ahead of the April-end annual deadline for reporting emissions.

“It seems like companies are more or less done (for 2014 compliance) and there’s no last-minute panic,” one said.

By Ben Garside – ben@carbon-pulse.com

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