EU carbon extends 4-day rally

Front-year carbon allowances surged past €15 Wednesday amid stronger oil and power.

By 17.30 CET, the 2009 EUA was trading at €15.15, up €0.45 on Tuesday’s close, and its highest closing position since 8 May.

Prices have now rallied 8 per cent since last Friday’s close.

July Brent crude oil pushed past $60/bbl, and traded $1.80/bbl higher than its settle last night.

German power firmed to €54.20/MWh, up €0.90 on Tuesday’s close.

“It is the same story as yesterday,” said a trader.

“We are following oil and macroeconomic news at the moment.”

High volumes of spot allowances traded. Some 12 million changed hands directly on the Bluenext exchange.

This was the highest volume of spot allowances seen this month amid a general upturn in spot trading.

An average daily volume of 8.9 million spot EUAs have been traded directly on the Bluenext bourse so far in May.

Overall, some 33 million allowances traded through the day, of which exchanges saw 21 million and brokers handled 12 million.

“I think a lot of utilities were buying the spot ahead of the long holiday this weekend,” said a trader.

In the secondary CER market, the 2009 contract closed at €12.55, up €0.50 on the previous close.

Prices in the offset market remain relatively flat further along the curve.

The 2012 CER closed only €0.65 higher than the 2009 CER.