Bullish outlook for European energy, carbon prices to year-end, say analysts
The second half of 2025 will see higher prices across European energy markets, as well as EUAs, despite increases in gas production, uncertainty due to US tariffs, and weaker-than-expected demand, a consultancy forecast in a report circulated this week.
Read MoreFEATURE: Direct air capture shifts from hype to reality as race for scale and survival begins
Mounting costs, technical challenges, and growing scrutiny are fuelling doubts over whether direct air capture (DAC) can deliver on its carbon removal promise, raising concerns that policymakers may be placing too much faith in a technology still in its infancy.
Read MoreEuro Markets: EUAs fall 1.5% after early excitement around halted US tariffs, TNAC figure
Benchmark EUA futures fell 1.5% on Thursday, retreating from a one-week high earlier in the day fuelled by excitement about the latest TNAC figure and news that President Donald Trump’s wide-reaching tariffs have been blocked by a US court.
Read MoreEuro Markets: EUAs make slim gains after funds extend net long positions
Benchmark European carbon prices were forced to settle for a small gain on Wednesday as the market initially reacted strongly to funds marginally extending their collective net long position, with strength also fed in from a supportive auction result, before prices eased over the afternoon, while UKAs slipped lower after investors cut their previous-record bullish positioning.
Read MoreEuro Markets: EUAs slump back as market awaits key investor, TNAC data
Benchmark European carbon prices fell on Tuesday, moving as much as 3% lower in a late sell-off, as sources noted a likely correction lower following Monday gains linked to a delay of US tariffs on the EU, with participants also hesitant to take on too much risk ahead of Wednesday’s publication of funds’ positioning data and the European Commission’s release of the 2024 Total Number of Allowances in Circulation (TNAC).
Read MoreUS tariffs having minimal effect on EUA prices, says analyst
The impact of US tariffs on EUA prices has been minimal, according to an analyst on a webinar on Wednesday, who sees benchmark European carbon permit price rises in 2026 driven by decreases in free allocations and tighter auction volumes.
Read MoreANALYSIS: EU-UK linking announcement “positive” but leaves market with more questions than answers
News this week that the EU and UK had struck an initial agreement to link their emissions trading systems (ETSs) with exemptions from upcoming carbon border fees sparked a flurry of British market activity, pushing benchmark prices above £55 for the first time since 2023, but traders and analysts alike questioned the scale of the gains given officials are yet to provide a timeline or any firm details on implementation of a link-up.
Read MoreEU ETS has delivered but faces uncertainty amid post-2030 climate target delay -report
The EU’s Emissions Trading System (ETS) is facing a period of uncertainty, as pressure mounts ahead of a revision next year to align with the bloc’s upcoming 2040 climate goal, and calls grow lounder for integrating international credits into the scheme, according to a report published Wednesday.
Read MoreGold Standard provides further updates on cookstoves, CCPs, Article 6 crediting framework
Gold Standard clarified updates on Tuesday to its crediting framework, concerning cookstoves project developers using the fraction of non-renewable biomass (fNRB), new requirements for those looking to secure CCP labels, and its planned alignment with Article 6.
Read MoreVerra launches review into European agri carbon project
Verra has launched a review into an eastern European agricultural land management carbon project and now plans to update the associated methodology, it announced Tuesday.
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