Carbon price keeps falling, driven by lower gas and coal prices

By Frank O. Brannvoll, Brannvoll ApS, Denmark

The carbon market was almost unchanged at EUR81 after having reached EUR86, but lower oil, gas and coal prices pushed the EUA downwards.

As the support of EUR84 was again breached, technical selling from speculators also increased. The increased auctions kept adding selling pressure to the market.

The price is still seen in a EUR80-88 range but may test the major support at EUR78.

EUA front-year contract, January 2022-October 2023

The United Kingdom Allowance (UKA) is still trading at EUR49/GBP42, with an unchanged spread of EUR32 to the EUA.

The beginning of CBAM on 1 October is expected to see increased attention in terms of how the system will work as payments will start in 2026 and the next 15 months will put the procedures in place.

Brannvoll ApS recommends that companies outside the EU investigate the impact this will have as well as how to mitigate and manage risk.

Brannvoll ApS forecasts a range of EUR65-105 with an average of EUR90 for 2023.