Investment funds increased their combined net long position in EUA futures and options to its highest level since August 2026, according to the latest Commitment of Traders (CoT) report published on Wednesday.

Data covering positions as of last Friday showed that investment funds increased their combined net long holdings in EUA futures and options — the difference between long and short positions — by 7.3 million allowances week on week to approximately 43 million allowances.

The nearly 20% weekly increase pushed funds’ net bullish position to its highest level since early August, suggesting that speculative investors have become increasingly optimistic about the outlook for European carbon prices. 

The increase was driven by opposing movements on both sides of the market, with gross long positions rising by 8.5% to around 71.6 million allowances, while short positions fell by 5.2% to 28.5 million allowances.

However, the sharp increase in speculative bullish positioning was not matched by an equally strong rise in carbon prices, with benchmark EUA futures gaining just 3.4% over the same week.

The divergence suggests that while investment funds have become increasingly bullish, the additional speculative exposure has yet to translate into a comparable increase in carbon prices.