The European carbon market continued to rise in yesterday’s session, despite a downward correction early in the morning. The EUAs traded as high as €76,64, before closing at €76.25, its highest settlement since 5 January.  However, the daily increase of 2,74% was not as noticeable as the one recorded in the previous session.

Once again, the carbon price mirrored the bullish sentiment that has dominated the gas market. TTF front month increased to its highest in three weeks amid planned outages in Norway. However, gas flows to Europe are expected to return slowly to normal by June 5.

According to data published by Gassco, the Norway operator responsible for transporting gas to continental Europe, gas supplies stood at  264,9 mcm/day on Wednesday, significantly higher than 178,9 mcm/day reported in the previous day. Furthermore, there is no indication of any extensions to the current planned maintenance schedule, a bearish signal for both gas and carbon. 

“European markets have also been given a lift by the 40% surge in US Henry Hub futures this month, making LNG imports more expensive for European buyers,” according to Quantum Commodity Intelligence. Furthermore, Asia JKM gas prices have settled at their highest since early January due to higher temperatures boosting power demand for cooling. 

Lower wind and solar output are also adding some bullish pressure to the gas market. According to Energy Quantified, wind output anticipated for Wednesday in Germany, Europe’s largest gas consumer, “should average 13,8GW on Wednesday, down 3,8 GW from Tuesday, but sill 1,3 GW above normal.”