U.N. offsets crash to 15 cents ahead of EU ban vote
ICE Futures Europe Dec 12 ERU contract opened at 32 cents, but crashed to a record low of just 15 cents in morning trade.
By 1550 GMT, it traded at 23 cents on relatively large volume of 7 million units traded.
“There must have been some big issuance today as there are three big counterparties that are involved in primary market that are selling aggressively,” said one trader.
A second trader said prices had been dragged down by an impending EU vote that could ban companies from using some credits in the EU Emissions Trading Scheme.
The EU’s Climate Change Committee will on Thursday vote whether to ban ERUs from countries that have not signed up to a second commitment period under the Kyoto Protocol.
The decision would mainly affect credits from Russia, which account for about a third of total supply.
The heavy selling dragged down CER prices, with the Dec. 12 contract falling to 31 cents, yet another record low, before it nudged up to 39 cents by the time of writing.
In the market for EU Allowances, the forward contract, which expires on Dec. 17, fell 1.5 percent to 6.74 euros versus Tuesday’s close.
“We bounced back too quickly from historic low last week, and it seems the price is now correcting back,” a third trader said.
He referred to EUAs 2012 touching 5.62 last Thursday followed by four days of consecutive increases, which pushed the contract above 7 euros to a one month high of 7.13 euros on Tuesday.
“People now realise that there was no fundamental reason for such a big jump,” he added.
Energy markets continued to give mixed signals, as front-year Brent crude rose 1.5 percent to $109.55/bbl, while front-year baseload German power dipped 0.2 percent to 45.60 euros/MWh.
At the time of press the EUA market saw 44 million allowances of all vintages changing hands.
By Andrew Allan firstname.lastname@example.org and Marton Kruppa – email@example.com
- Canada to decide in June on proposed Enbridge oil pipeline-minister 25 Apr 14 02:41
- EU carbon rises 1.8 percent on reduced supply 24 Apr 14 17:38
- China to impose tougher penalties on polluters under new law 24 Apr 14 13:43
- Australia climate plan leaves emission cuts with government 24 Apr 14 10:13
- NZ carbon unchanged as buyers eye U.N. market 24 Apr 14 06:25
- EU carbon edges lower on weak auction demand 23 Apr 14 18:43
- Lufthansa says helping to test new aviation biofuel 23 Apr 14 17:51
- China's Shenzhen to cancel surplus carbon permits 23 Apr 14 11:20
- EU climate chief urges China to show international commitment 23 Apr 14 11:00
- China carbon cash party over as U.N. credit stream dries up 23 Apr 14 03:15
- Parched California moves to boost water saving toilets, faucets 22 Apr 14 23:24
- Barclays to pull out of major commodities trading areas 22 Apr 14 17:57
- EU carbon extends 3-week high on healthy auction demand 22 Apr 14 17:22
- Stand-off throws Australia climate policy in disarray 22 Apr 14 11:07
- China's new environment law submitted to parliament 22 Apr 14 09:31
- Pipeline delay gives boost to Obama's political base 22 Apr 14 00:29
- China's carbon traders flock to Hubei in search of profits 21 Apr 14 11:46
- Australia's Palmer says won't back government climate plan - report 21 Apr 14 10:34
- China's Li says more major energy projects to start 21 Apr 14 03:17
- Romania aims to exempt heavy industry from green energy costs 18 Apr 14 03:45
- EU carbon poised for 4 pct weekly gain on reduced supply 17 Apr 14 17:54
- Britain's Drax set to win 300 mln euro EU carbon capture cash 17 Apr 14 14:29
- China's Guangdong sells 680,000 carbon permits at 60 yuan each 17 Apr 14 12:08
- China's Chongqing to launch carbon market in May 17 Apr 14 11:08
- EU to host industry talks ahead of setting 2030 climate goals 16 Apr 14 21:35
Most read news
Most read News last 7 days: