The week opened with further price declines on the European carbon market. The EUA Dec’26 extended its recent downward trend for a fifth consecutive session, falling another €1.50 to settle at €69.18 — the lowest closing level since late April 2025.

Daily turnover reached nearly 50 million allowances, below this year’s average of around 61 million, but still notable given that US equity markets were closed yesterday for Presidents’ Day.

Adding to the downside pressure, gas prices are also declining, as “forecasts for milder weather pointed to easing demand pressure, with the heating season nearing its end,” according to analysts at ANZ Research.

Over the past week, EUAs have fallen by around 15%, with the market focused on the political debate ahead of the upcoming EU ETS review, which has been scheduled since 2023. “The EU ETS faces its strongest opposition in 20 years,” Carbon Insights warned, as quoted by Montel News, citing mounting pressure from European industry leaders and politicians to weaken the system’s design.

The International Emissions Trading Association (IETA) also warned that growing risks of political intervention are unsettling the market, stressing that it “requires political as well as regulatory stability.” According to IETA’s President and CEO, “The EU ETS must remain protected from ad hoc political interventions that risk undermining investor confidence and weakening Europe’s decarbonisation pathway.”

We expect tomorrow’s Commitment of Traders data for last week to show a significant reduction in speculative exposure, although positioning is likely to remain elevated by historical standards, which “leaves prices open to extensive downside risk,” according to Argus Media