Grey Epoch

We are delighted to attend the 2024 Energy Risk Awards Ceremony to pick up our award for Liquidity Provider of the Year. Members of the Grey Epoch Europe Team Emilio Fontana, Victoria Basterra Gil and Beatriz M. picked up our award last night, celebrating with other professionals at the forefront of the energy industry. Read more about Grey Epoch written by Risk.net here: https://lnkd.in/erwkxdbN #celebrate #winners #awards #EnergyRisk #ETS

Another quiet August news week in the European Energy complex. Of note, warm temperatures in rivers in France caused the French to turn down three nuclear reactors, to avoid discharging warmed cooling water into those rivers which would in turn have raised their temperatures more, to a point where the local wildlife would be in danger. This supported the French power price and rippled through to the wider European power market as a consequence, France being a net exporter of power. Meanwhile, in Natural Gas, the net long position of funds continues to grow week on week, reflecting perhaps macro uncertainties, geopolitical risk and a perception of tightening supply and demand balances around storage concerns, production maintenance in Norway and so on.   EUAs then continue to trend higher, supported by a generally strong European energy complex. December 2024 EUA Futures closed the week at 72.52€, making a gain of 2.38€. In options, the August contract expired for the first time, which in itself is noteworthy, although the expiry itself passed quietly enough, with the underlying price sufficiently far from the larger open strikes.   Weather-wise, in the coming week, we’re expecting a bit of wind in Germany, with wind-powered generation expected to peak at around 30GW on Wednesday vs a more “normal" level of less than half that at this time of year. Beyond next week, we should start to see remnants of storm Ernesto on European shores, as it forges its way across the Atlantic carried by the jet stream. Join our newsletter to receive the full version of the Weekly Market Comments straight to your inbox: https://lnkd.in/gBBbYxZi #Emissions #EUETS #UKETS #Energymarkets #CarbonMarket

The main news last week in European energy markets was the Ukrainian military incursion into the Kursk region of Russia, which created additional fear in natural gas markets already spooked by geopolitical events in the Middle East. Kursk is an important natural gas hub, and specifically a key transit point for gas flowing through the Sudzha pipeline. This is the last pipeline flowing meaningful natural gas volumes to Europe from Russia via Ukraine. As of now, we understand that gas is still flowing, however, the market concern is around interrupted volumes in the short term; the effect has rippled throughout the natural gas curve because of concerns around the ability to refill storage ahead of the coming winter should this flow cease. Most market participants would have this flow at zero from January 2025 in their balances, as most think it unlikely that Russia will renew the transit arrangement they have with Ukraine when it expires, as this involves paying Ukraine to ship gas through their territory. In addition, in the natural gas markets, there are continued rumours about payment issues between Gazprom and European utilities who continue to buy directly from it, which again add to concerns about interrupted flows. The European warm weather was supposed to normalise a bit sooner than it looks like it will, with the hottest days of the year so far yesterday in Paris and London for instance, so the market has rolled the heat forward a bit, supporting prices. The forecast suggests that temperatures will return to normal later this week. In the Atlantic Basin, storm Debbie dumped over a foot of rain on the East Coast of the US but didn’t impact any hydrocarbon production. A strong tropical wave is on its way across the Atlantic and likely to form a storm, and potentially a strong hurricane, within the next week or so, to be called Ernesto. Current modelling suggests this storm is likely to re-curve, making it a “fish mixer” in the Atlantic basin, but unlikely a threat to the US mainland. If it does develop into a strong hurricane, it is likely that its remnants will be felt in Europe. In Emissions, the deadline to comment on the UK Government’s consultation about adding greenhouse gas removals into the UK ETS is the 15th August. Given the change of government, since this consultation was announced, it is unclear what impact the consultation might have or whether the new UK administration has a new strategy in mind. A report by Frontier Economics explored the potential benefits of linking the UK and EU systems, suggesting that if the current price gap continued, the UK government could lose £3.5 - 8 billion between 2025 and 2030. Join our newsletter to receive the full version of the Weekly Market Comments straight to your inbox: https://lnkd.in/gBBbYxZi #Emissions #EUETS #UKETS #Energymarkets #CarbonMarket

The European Energy Exchange AG (EEX) has released the revised individual auction volumes for European Union Allowances (EUA) spanning September to December 2024. The updates indicate some significant shifts compared to both the same period in 2023 and the preliminary volumes initially set for 2024. 🇪🇺  𝐄𝐔 𝐂𝐀𝐏𝟑 𝐀𝐮𝐜𝐭𝐢𝐨𝐧 𝐕𝐨𝐥𝐮𝐦𝐞𝐬 For the EU CAP3 auction, the revised volumes for September to December 2024 are set at 3,287,500 EUA. This marks an increase from the 3,035,500 EUA auctioned in the same period in 2023 and as usual it's below the preliminary volume of 4,427,000 EUA.  🇩🇪 𝐆𝐞𝐫𝐦𝐚𝐧 𝐀𝐮𝐜𝐭𝐢𝐨𝐧 𝐕𝐨𝐥𝐮𝐦𝐞𝐬 The German auction volumes for the same period in 2024 have been revised down to 1,886,500 EUA, compared to 2,147,000 EUA in 2023. Initially, the preliminary volumes were set higher at 3,355,000 EUA. 🇵🇱 𝐏𝐨𝐥𝐢𝐬𝐡 𝐀𝐮𝐜𝐭𝐢𝐨𝐧 𝐕𝐨𝐥𝐮𝐦𝐞𝐬 For Poland, the September to December 2024 auction volumes are now 2,833,500 EUA, a decrease from the 3,347,500 EUA in 2023. The preliminary volumes had been set at 4,193,000 EUA. 🗓 𝐏𝐫𝐨𝐣𝐞𝐜𝐭𝐢𝐨𝐧𝐬 𝐟𝐨𝐫 𝟐𝟎𝟐𝟓 Looking ahead to 2025, the overall volumes for the EU CAP3 auction are projected at 520,794,500 EUA, an increase from the 501,457,500 EUA set for 2024. ◽ EU CAP3 Individual Auction Volumes for Jan-Aug 2025: 3,245,500 EUA, up from 3,099,500 EUA in 2024. ◽Preliminary EU CAP3 Individual Auction Volumes for Sep-Dec 2025: 4,547,500 EUA. These volumes are preliminary and subject to the publication of the 2024 TNAC (Total Number of Allowances in Circulation) on June 1 next year. ◽Germany: The 2025 auction volumes are set at 96,764,500 EUA, down from 106,019,500 EUA in 2024. ◽Poland: The 2025 auction volumes are set at 62,362,500 EUA, down from 68,627,000 EUA in 2024. 𝐍𝐨𝐭𝐚𝐛𝐥𝐞 𝐂𝐡𝐚𝐧𝐠𝐞𝐬 Starting in 2025, aviation allowances will be integrated into the EUA auctions, eliminating the need for separate aviation-specific auctions. Reach out to Grey Epoch to learn more about the EU ETS. #EUETS #carbonmarkets #Carbontrading

Yesterday, commodity markets across borders have been under significant pressure, with nearly all experiencing a downward impact. Last week saw a notable increase in EUA December 2024 futures, starting with the low of the week at €67.20 on Monday and peaking at €71.50 on Thursday, the highest in two weeks. The week ended with a settlement at €70.58, marking an increase of €2.71 from the previous week. Gas prices also rose to their highest in several weeks, driven by concerns over supply risks and hot weather. Tensions in the Middle East and strong LNG demand in Asia further fueled this increase, impacting EUA prices as well. In contrast, the UK market experienced a slight decline. Join our newsletter to receive the full version of the Weekly Market Comments straight to your inbox: https://lnkd.in/gBBbYxZi #Emissions #EUETS #UKETS #Energymarkets #CarbonMarket

It’s starting to feel like summer finally in Western Europe, with the Met Office predicting Paris will hit 30 C, or almost 100 F. In London, it feels like everyone is on the beach. Perhaps the main headline in European energy markets was the announcement of a re-start of throttling of cross border transmission capacity between France and Germany. In the earlier part of the year, this caused spreads between German and French power to reach levels not seen in the last five years, with French electricity trapped in France for local reasons. As this throttling was not in place for the last couple of months, the market was unclear if it would return or not. Confirmation of constraints in August and September has had a predictable relative impact on French power (bearish) and German power (relatively speaking bullish), causing the spreads in those months to widen out again. There remains uncertainty on whether this will continue into Q4, although Q4 spreads have widened somewhat in sympathy. As we get into the height of summer, the tropics is looking like they might liven up, with conditions generally more conducive to storm development and the European model suggesting we might see a storm around the Caribbean in early August (next weekend). Too early to comment sensibly on this or to understand whether it might represent a threat to hydrocarbon production in the US Gulf. We understand that Freeport LNG has now fully returned from Hurricane Beryl related interruptions with all three trains back up. Despite having that supply back in the market, heat in Asia has underpinned demand for LNG. In emissions, last week began with the low of the week at €64.24, the lowest in 3 months. We rallied almost 5 euros by midweek then sold off a bit, closing out a very quiet Friday at €67.87, marking a €1.57 increase from the previous week's close. Join our newsletter to receive the full version of the Weekly Market Comments straight to your inbox: https://lnkd.in/gBBbYxZi #Emissions #EUETS #UKETS #Energymarkets #CarbonMarket

Another quiet week across the European Energy complex. We understand that Freeport LNG is now coming back online after Hurricane Beryl induced an outage. As a result, JKM (Asian natural gas benchmark) is now under 12 USD/MMBtu, reflecting a more comfortable perception of supply-demand balances. Weather forecasts suggest that the tropics should remain quiet in the current forecasting window (i.e. the next couple of weeks). In Europe, the weather is warming up, with Paris hitting 35 centigrade, just in time for the Olympics. So far 30 wildfires reported in Greece.   This morning in European power we saw downside across the board, except for the front month. In emissions, last week opened with the high of the week at €69.58 on Monday. Throughout the week, prices and volumes trended downward within a €3.86 range, hitting a low of €65.72 on Friday, the lowest since April 30th. The week ended with a settlement price of €66.30, marking a €2.89 decrease from the previous week. Join our newsletter to receive the full version of the Weekly Market Comments straight to your inbox: https://lnkd.in/gBBbYxZi #Emissions #EUETS #UKETS #Energymarkets #CarbonMarket

The UK's Climate Change Committee urges the government to strengthen the UK Emissions Trading Scheme (ETS) by raising carbon prices and linking with the EU ETS to drive decarbonisation. Current low prices hinder investment in clean energy. The UK is also exploring new measures to include greenhouse gas removals and waste incineration in the ETS. The goal: reduce emissions by 78% by 2035 and achieve net zero by 2050 Click to read the full article: https://lnkd.in/emz5WzM5 Reach out to Grey Epoch to learn more about the UK ETS #UKETS #carbonmarkets #UKClimate

A generally sedate week again in the European Energy complex. Weather-wise, heat continues in Eastern Europe, and temperatures are rising in Italy and Greece. 42 centigrade in Puglia with wildfires having already broken out in Greece. However, the Jet Stream remains south of the main Western and Central European demand centres, and as a result, France and the UK remain at lower than normal temperatures. Hurricane Beryl did affect the US Gulf, with local power cuts lasting for several days (including for the author’s extended family). We understand that Freeport LNG cancelled at least four LNG cargoes. Forecasts suggest that the tropics will be quiet for the rest of the month, with wind shear, dry air, dust and high pressure dampening storm activity.   Market-wise, there is nothing particularly of note to say, perhaps weaker than expected Chinese data today caused a dip in Natural Gas prices, and the heat has caused spikes in Eastern European power markets, particularly Hungary.   The EU ETS market reached its high at €71.85 on Monday, with the week’s low at €67.60 on Thursday. Tight trading ranges on Tuesday, Wednesday, and Thursday, suggest a lack of strong momentum. Despite low summer volumes, prices rallied back from Thursday’s lows on Friday with the December 24 contract ending the week at €69.19, down €1.14 from €70.33 the previous Friday. Join our newsletter to receive the full version of the Weekly Market Comments straight to your inbox: https://lnkd.in/gBBbYxZi #Emissions #EUETS #UKETS #Energymarkets #CarbonMarket

We are excited to announce that Grey Epoch has been added to zero44's new trading platform! Over the past year, we have collaborated closely with the zero44 team and their clients on the EU ETS. The addition of the trading platform benefits trade flows and operations. Zero44 simplifies carbon regulatory compliance for shipowners, managers, and operators by offering an end-to-end software solution. This platform helps manage commercial risks and strategic implications associated with CII, EU ETS, and FuelEU Maritime. To explore the platform, please click here: https://www.zero44.eu/ #carbonmarkets #EUETS #EUAs #shipping