With a 20 percent drop since the start of the year, the European carbon price is now trading at its lowest levels since the Russan invasion of Ukraine in March 2022. Looking ahead, we expect a continued lowered emissions pattern due to a weak energy complex and a frail economic outlook to weigh on prices throughout the year. The shift in compliance deadline till September may lower demand in the coming months, while current uncertainty over the exact RePowerEU volumes sold to the market beyond 2024 should be lifted as the year progresses. We expect baseload support from climate policy – the 2040 target debate brings alive the prospect of a tight future while market participants are facing a de facto 174 Mt cap cut in 2024 alone. We expect a progressing rise in prices over the year, and estimate an average EUA price for 2024 at €76/t, down 15.6% from our previous forecast in September at €90/t.
Table 1: EUA price forecast 2024 European carbon price starts 2024 in free fall The EUA Dec-24 contract has seen a rough start to 2024 shaving off more than 20% since the start of the year and at €62/t is now trading at the lowest levels since the Rus…
A weekly cap of what moved EUA prices and a clear view of the week ahead. We set out the drivers, their directional impact, and what matters next.
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