Last week, EUA prices held steady, ranging between €60 and €65 per ton. The market was influenced  by oversupply, softer industrial demand, and downward pressure from shifts in natural gas prices.

For this week, there is a possibility that  EUA prices could see increased volatility this week, with several influencing factors at play. The rising Dutch TTF gas prices, driven by concerns over potential disruptions from Middle East tensions, are likely to push EUA prices upward. However there is still a bearish sentiment ongoing in the market, linked to oversupply and weak industrial demand, may have an impact on a possible decrease in the EUA prices. Additionally, low emissions from power generation due to a higher share of renewables have reduced demand for allowances.

Auction volume: 14.6 million EUAs , 2.8 million more than last week

The compliance period for 2023 concludes on 30 September 2024. To avoid potential compliance-related penalties, please consider this deadline when placing your order. Under no circumstances can AFS be held responsible for fines resulting from late deliveries by AFS.

Energy Fundamentals

• Gas storage sits at 93.6% full on September 21st, compared to 94.3% on September 21st, 2023.
• EUA September options expiry is on Wednesday, 25th
• EIB finances 17 solar power plants in Southern Europe with a €166 million loan
• EU Progress in Energy Union Report
• Cyprus joined European power grid after deal Greece
• Dutch TTF entered a more neutral phase
• Oil prices rise on Middle East Concerns

Investment Funds

• The net short speculative position held by investment funds decreased to -21.52m EUAs on September 13th (vs. -14.24m EUAs on August 30th).
• Gross short positions increased to -65.10m EUAs (vs. -54.53 m EUAs).
• Gross long positions increased to 43.57m EUAs (vs. 40.29m EUAs).

Market Prices:

• Indicative Dec24 EUA Price: €64.41
• Indicative Spot EUA Price: €63.81
• YTD Dec24 EUA Price: €66.63
• MTD Dec24 EUA Price: €65.5

Chart A: December 2024 EUA Price (EUR)

Technical Analysis

From a technical perspective, the CCI is gradually moving out of the oversold zone on the daily chart, while the MACD appears to be signaling a potential shift in direction. The RSI is also trending upwards, indicating a possible gradual move higher. The first key resistance level for the bulls to break is at 64.30, followed by 66.07 and 66.62. With options expiry in two days, increased volatility is anticipated, which could result in market squeezes.

Chart B: December 2024 EUA Price (EUR) - Technical

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