European carbon contracts (EMISS) have today knocked out historic peaks at €100. The driving force behind the quotations continues to be low TTF gas prices, which are driving industrial activity on the Old Continent.
Demand for coal contracts is rising in the expectation that falling natural gas prices may prompt the industrial sector to resume production that was curtailed or shut down due to soaring energy costs last year. At the same time, the prospect of tighter climate regulations means that emission rights may be less available, discouraging market participants with surplus allowances from selling them. The EMISS market is a key aspect of Europe's long-term explicit decarbonisation plan.
Although sentiment around the industrial sector in Euroland remains at very low levels, we are seeing the first signs of a rebound, which bodes well for the Emiss market. Source: S&P Global
EMISS contract quotes. Source: xStation 5
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