EU carbon prices rocket
After languishing at record lows since the onset of the global financial crisis in 2011, Europe’s carbon market has burst into life
Prices for EU carbon allowances (EUA) have quadrupled in the past 15 months, rising from around €5 ($5.82) a tonne in May last year to over €20/t in September 2018. Since last autumn, the EU Emissions Trading System (EU ETS) has seen a significant influx of speculative capital, driving prices higher and surprising traditional participants as investors scramble to build positions in a market that many say is only going one way. In fact, EUAs have been the best-performing energy commodity in Europe this year, more than doubling in value since 1 January. In comparison, front-month Brent crude has risen 9.5% and API2 coal has declined by 0.3%. The surge in buying is based on widespread expectati
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