EUAs slightly recovered as power and gas prices sharply eased back on Friday

The significant drop of wind output over the weekend maintained the European power spot prices above 200€/MWh for today in northwestern Europe and up to 250.95€/MWh in France, despite a the retracement of gas prices on Friday. The day-ahead prices averaged 224.19€/MWh in Germany, France, Belgium and the Netherlands, +18.84€/MWh from Friday and +92.38€/MWh week-on-week.

The carbon prices slightly rebounded and consolidated on Friday with the benchmark contract trading rangebound between 87 and 90€/t amid easing gas and power prices as traders bet on uninterrupted Russian gas flow and no western sanctions on energy supply. The EUA Dec.22 closed the week at 88.14€/t, +1.11€/t from Thursday’s settlement but -1.33€/t (-1.5%) week-on-week.

The emissions prices are however collapsing this morning as the power and gas prices are surging again consequently to the stronger sanctions on Russia decided by the West over the weekend, including an initially debated SWIFT ban. The Dec.22 dropped as low as 80.12€/t in the first minutes of trading but quickly rebounded above 83€/t as the speculators’ sell-off to generate cash is likely to have been offset by some compliance buying attracted by the low levels of prices.

The power forward prices posted heavy losses alongside the gas market on Friday, and are similarly soaring back this morning. The German economy and climate minister Robert Habeck declared yesterday that the country is considering delaying the closure of its last nuclear reactors (initially scheduled at the end of the year) and slow down its coal phase-out to protect Germany from a potential halt in Russian gas flow.