EU Carbon Markets Re-Open, Trading Slow

by | Feb 4, 2011

Buyers are wary of stepping back into the European spot market for carbon, which began to re-open today after a two-week hiatus, Reuters has reported.

The carbon registries in France, Germany, the Netherlands, Slovakia and Britain re-opened today, and the Paris-based BlueNext spot exchange resumed trade.

Thefts caused the European Commission to close the market’s national registries, where permits are kept, on January 19. At least 45 million euros worth of EU allowances were stolen.

But the market was quiet today, with some traders expecting further thefts to occur and disrupt trading. Only 127 EUA lots had traded on BlueNext by 3:50pm GMT, compared to 740 lots for the whole day on the same date last year.

“Volume has been very low. People are still scared of trading in case more thefts are revealed or they get stuck with permits they bought in good faith,” an emissions trader told Reuters, and some traders said they feared that unidentified stolen permits were still being circulated.

“You’d have to be a brave man to trade that stuff,” said Trevor Sikorski, carbon analyst at Barclays Capital.

European Union climate commissioner Connie Hedegaard has said some of the bloc’s carbon registries could stay closed for weeks as they implement security upgrades.

Picture credit: vx_lentz

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