EU
The European Union Allowance (EUA) prices for June averaged at EUR 72.67 per tonne, up 3.25% from May. Prices extended their upward momentum from the previous month, briefly reaching a three-month high of EUR 75 per tonne in mid-June.
This increase was primarily driven by tighter energy market supply and a rebound in natural gas prices, both of which boosted demand for carbon allowances. Additionally, ongoing discussions within the European Commission regarding the Market Stability Reserve (MSR) further contributed to bullish sentiment. A modest recovery in industrial activity across Europe also supported allowance demand.
However, toward the end of the month, prices retreated from their highs due to profit-taking by some investors and anticipation of higher auction volumes during the summer. As a result, the market is expected to enter a short-term consolidation phase.
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China
The China Emission Allowance (CEA) prices for June averaged at RMB 71.04 per tonne, up 1.63% from the previous month, breaking the downward trend that had persisted since the beginning of the year. Prices showed a notable rebound starting mid-month, eventually climbing to RMB 76.57 per ton by the end, a two-month high.
The recovery was primarily driven by market expectations that verification reports would be processed more swiftly and that the emissions trading scheme would expand to cover additional sectors. At the same time, regulators signaled plans to strengthen compliance oversight, reinforcing market expectations for increased future demand for allowances.
Overall, the recent rebound in CEA prices following several months of decline suggests simultaneous improvements in both policy direction and market confidence.