EU Carbon Prices Slide Amid Market Intervention Plans
Carbon prices fell five percent today as the EU weighed increasing permit supplies to curb energy costs. The move follows price spikes from regional conflict.
European carbon prices experienced a sharp decline on Tuesday after the European Commission suggested it would consider increasing the supply of carbon emission permits to help stabilize surging energy costs. The benchmark EU carbon contract fell by more than 5% following statements from Commission President Ursula von der Leyen, who indicated that the bloc is preparing short-term measures to address price volatility. These market pressures have been intensified by the ongoing conflict involving the United States, Israel, and Iran.
In a letter addressed to EU leaders, von der Leyen proposed adjustments to the reserve that regulates permit supply and suggested moderating the reduction of free CO2 permits currently allocated to industrial sectors. The benchmark contract eventually settled 3.8% lower at 66.33 euros per metric ton, having earlier reached its lowest point since April 2025 at 64.93 euros.
