Overview

EUA prices (Dec-26 contract) climbed through a choppy week. Carbon then pushed higher into midweek, touching a five-day intraday high on Wednesday as EU co-legislators finalized changes to the Market Stability Reserve (agreeing a 700-million-allowance threshold, effective once formally adopted), through that news itself drew little immediate market reaction.

Energy markets took over as the dominant driver into the back half of the week: Dutch TTF gas broke above €90/MWh on Tuesday for the first time since December 2022 on intensifying competition with Asia for LNG ahead of winter. Carbon tracked that strength higher, with gas finishing the week up roughly 7% - including a Friday surge tied to news that EU gas storage levels had begun drawing down for the first time this heating season - even as EUAs themselves eased back slightly on Friday to lock in the week's gain. Separately, analysts flagged the escalating Iran conflict as a swing factor that could push EUAs toward €100 this winter if the energy shock deepens - a reminder that this week's carbon strength was largely energy-led rather than ETS-fundamentals-led.