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Home > Finance > Benchmark EU carbon contract falls 7% on intervention risk

Benchmark EU carbon contract falls 7% on intervention risk

Published by Global Banking & Finance Review®

Posted on February 12, 2026

1 min read

Last updated: February 12, 2026

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Tags:sustainability Climate Change risk management financial markets

Quick Summary

EU carbon prices fell 7% due to political intervention concerns, influenced by German Chancellor's comments. The EU ETS review is upcoming.

EU Carbon Prices Drop 7% Amid Political Intervention Concerns

Impact of Political Comments on Carbon Prices

By Nora Buli

OSLO, Feb 12 (Reuters) - Europe's benchmark carbon prices fell sharply on Thursday morning, following comments from German Chancellor Friedrich Merz suggesting the EU must be open to revising or postponing tightening measures in the bloc's emissions trading system (ETS).

The benchmark December contract was down 5.26 euro at 73.19 euros a metric ton at 0858 GMT, and earlier fell as low as 72.70 euros/ton, according to LSEG data.

Current Market Trends

Prices have come under pressure in recent weeks amid a growing risk of political interference in EU carbon price formation, with Merz' comments adding to the narrative, said Arne Lohmann, chief analyst at global Risk Management.

Upcoming EU ETS Review

The EU ETS system is scheduled for a review after the summer. The Commission will decide whether to continue the EU's existing system of giving industries some free CO2 permits, to help them compete with foreign firms that don't pay for their pollution.

(Reporting by Nora Buli; editing by Nina Chestney)

Key Takeaways

•EU carbon prices dropped 7% amid political intervention fears.
•German Chancellor's comments influenced the market.
•The benchmark December contract fell to 73.19 euros/ton.
•Political risks are affecting carbon price formation.
•An EU ETS review is scheduled after summer.

Frequently Asked Questions about Benchmark EU carbon contract falls 7% on intervention risk

1What is carbon pricing?

Carbon pricing is a method for reducing global warming emissions by assigning a cost to emitting carbon dioxide. It incentivizes businesses to reduce their carbon footprint.

2What is the EU Emissions Trading System (ETS)?

The EU Emissions Trading System (ETS) is a cap-and-trade system aimed at reducing greenhouse gas emissions by allowing companies to buy and sell emission allowances.

3What are carbon contracts?

Carbon contracts are agreements that specify the price for carbon emissions, typically used in trading carbon credits to meet regulatory requirements.

Impact of Political Comments on Carbon Prices

By Nora Buli

The benchmark December contract was down 5.26 euro at 73.19 euros a metric ton at 0858 GMT, and earlier fell as low as 72.70 euros/ton, according to LSEG data.

Current Market Trends

Upcoming EU ETS Review

(Reporting by Nora Buli; editing by Nina Chestney)

Frequently Asked Questions

1What is carbon pricing?

Carbon pricing is a method for reducing global warming emissions by assigning a cost to emitting carbon dioxide. It incentivizes businesses to reduce their carbon footprint.

2What is the EU Emissions Trading System (ETS)?

The EU Emissions Trading System (ETS) is a cap-and-trade system aimed at reducing greenhouse gas emissions by allowing companies to buy and sell emission allowances.

3What are carbon contracts?

Carbon contracts are agreements that specify the price for carbon emissions, typically used in trading carbon credits to meet regulatory requirements.