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
- Europe Power- Curve prices hold on to gains, shy away from more 25 Jul 14 17:37
- NZ carbon drifts further in pre-election lull 25 Jul 14 06:39
- EU carbon sinks 1.6 pct as industrial firms seen selling 24 Jul 14 17:45
- To cut carbon emissions, give communities rights to forest land - report 24 Jul 14 17:34
- China to roll out seven pilot markets for trading water rights 24 Jul 14 12:30
- For Californians, higher costs dampen support for clean energy 24 Jul 14 10:24
- Tianjin's carbon prices hit record low this week, over-allocation worries grow 24 Jul 14 06:19
- Vattenfall says tough conditions linger as underlying profit falls 23 Jul 14 17:47
- UPDATE 2: EU approves UK capacity market, renewable support scheme 23 Jul 14 15:43
- EPA chief in hot seat as lawmakers dissect carbon rule 23 Jul 14 13:09
- EU bosses outline energy savings goal to cut need for Russian gas 23 Jul 14 13:08
- France backs 30 percent energy efficiency goal -letter 22 Jul 14 21:20
- China warns against "blind" rush to build coal-to-gas plants 22 Jul 14 11:56
- UPDATE 1-Britain sticks with tough carbon target despite opposition 22 Jul 14 11:55
- EU carbon prices hold above 6 euros as analysts see more gains 21 Jul 14 17:41
- INTERVIEW-German local utilities want help with power plants 21 Jul 14 15:11
- Some Chinese offset projects to exit CDM if allowed 21 Jul 14 14:48
- Calif. carbon slips to $11.84/tonne as market shrugs off challenge 19 Jul 14 00:53
- EU carbon posts 5 pct weekly climb on utility buying 18 Jul 14 18:29
- S.Korean finmin says planned carbon market flawed, wants delay -paper 18 Jul 14 13:40
- NZ carbon falls further as emitters stay away 18 Jul 14 06:53
- European energy prices jump on Ukraine plane crash 17 Jul 14 20:27
- EU carbon price retreats below 6 euros after hitting 4-mth high 17 Jul 14 16:27
- FACTBOX- Carbon trading schemes around the world 17 Jul 14 10:35
- Global carbon market hope fades as Australia dumps CO2 trading 17 Jul 14 09:52
Most read news
Most read News last 7 days: