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UK Oil And Gas Costs To Rise 100% If Brexit Fails

UK Oil And Gas Costs To Rise 100% If Brexit Fails

Brexit negotiators’ failure to secure…

EC Announce the Withdrawal of 900 Million Carbon Allowances from Market

EC Announce the Withdrawal of 900 Million Carbon Allowances from Market

The European Commission has announced its plans to delay the auction of some 900 million carbon emission allowances, in an attempt to rescue the collapsing carbon market. The 900 million allowances that were scheduled for the next three years will not be released for sale until the last two years of the next trading phase, with 300 million sold in 2019, and 60 million in 2020.

Struggling economies throughout Europe have caused a collapse in demand, meaning that carbon prices have hit all-time lows this year, and lost over 80 percent of their value since 2008. The oversupply in the market is estimated to be in the area of two billion tonnes.

Matthew Gray, an analyst at Jefferies, said that the EC may even decide to eliminate the allowances permanently, in an attempt to boost carbon prices.

Related Article: PwC Report States that Global Temperatures will Increase by 6°C by 2100

Marcus Ferdinand, a senior market analyst at Thompson Reuters Point Carbon, said that, “we think it likely that some 700 million allowances will be permanently cancelled, with just 200m reinjected in 2019 and 2020, increasing EUA prices to an average of €10/t in 2013 rising to an average of €14/t in 2015 and settling around the €12/t for phase 3 as a whole.”

There are some who believe that the EC should have eliminated more permits. Statoil, Shell, and Dong Energy, have called for 1.4 billion permits to be withdrawn from the market, and some environmental groups are even asking for 2 billion.

By. Joao Peixe of Oilprice.com



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