Carbon futures in the European Union rose to €89.58 per ton, marking the fifth consecutive weekly increase. The price rise is driven by reduced auction volumes and emissions allowances and expectations of future quota shortages due to tightening environmental regulations. This is reported by Bloomberg.
The price of benchmark carbon allowances rose by 1.6% to €89.58 per ton on the ICE Endex in London, reaching its highest level since August 2023.
This marks the fifth consecutive week that the cost of carbon credits has shown an increase. ICE data shows that the net long position of investment funds in carbon is approaching its highest level since early 2018.
This year, major reforms to the EU emissions trading system have come into effect, including the abolition of free emissions allowances for the aviation sector.
Additionally, stricter regulations for shipping have been introduced, increasing demand for allowances from the maritime sector.
Gregory Idil, senior carbon broker at BRS Shipbrokers, commented on the market situation: "Options markets are showing strong confidence in higher prices at the beginning of 2026." He added that auction volumes this year will fall by about 20%, leading to a sustained reduction in supply.
An additional factor that could push prices even higher is the situation in the European natural gas market. Although base gas prices are heading for a weekly decline, they are still 5% above the low set last month.
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