As mentioned in the previous issue, speculators went in long after the 2026 auctions were released and participants are seeing this as a green signal for a more bullish market. At the same time the technical picture enhanced this, breaking upwards through the EUR73 mark that has been a major resistance during the summer.
Several industrial companies may have pushed their compliance buying before the European Commission’s release in July of a revised auction calendar for 2025 and 2026, as the 2025 volumes were unchanged and there were few adjustments for 2026. This has given fund managers the encouragement to go long, given that no additional supply was added to the market for funding of the Repower-EU initiatives.
Industrial participants are continuing compliance buying before the 30 September deadline, adding to the bullish sentiment.
Inside the European Parliament the discussions of 2040 targets has been tough with right-wing groups calling for scrapping the targets altogether. However, so far the targets support higher pricing in the long term. The EUA is now in a higher trend channel of EUR72.50-77.00, while long-term EUA prices for 2030 fell to EUR 80.00/t.
The front (Dec 25) contract was up five per cent compared to the last issue of ICR at EUR77.00.The UK Allowance (UKA) December 2025 rose five per cent to GBP56 (EUR64.80). Brannvoll forecasts a range of EUR65-85 in 2025 with a Dec 25 contract average of EUR75.
By Frank O. Brannvoll, Brannvoll ApS, Denmark
