Auction volume: 10.755 million EUAs, 1.525 million more than last week.

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Energy Fundamentals

The fundamental backdrop remains dominated by a combination of tight gas fundamentals and rising geopolitical risk. European gas storage currently stands at around 29% as of March 14, 2026, leaving inventories relatively low as the market approaches the start of the traditional injection season. At current price levels, utilities are reluctant to purchase gas for storage, raising concerns that refill rates may lag and potentially leave Europe vulnerable to a supply deficit ahead of the 2026–2027 winter. Geopolitical developments in the Middle East are adding further uncertainty to global energy flows. The security of the Strait of Hormuz has moved back into focus, with calls from the United States for international cooperation to safeguard the passage. At the same time, reports that Iran may allow tankers through the strait only if transactions are conducted in Chinese currency underline the growing politicization of energy trade and dubious intervention. Given the strategic importance of Hormuz for both oil and LNG shipments, any disruption or restriction could quickly tighten global supply and sustain the current risk premium in energy prices. In Europe, policymakers are increasingly focused on mitigating the impact of higher energy costs. The EU is reportedly considering looser carbon rules and expanded state aid frameworks to shield industries and consumers from rising prices. These discussions are expected to take center stage during the European Council Summit on March 19–20, where the timeline for potential ETS reforms — likely targeting implementation around July 2026 — could be clarified.

Overall, the market remains highly sensitive to geopolitical headlines while structural concerns around storage refilling continue to build. The combination of elevated prices, policy uncertainty, and supply risk suggests that volatility in European energy markets is likely to remain elevated in the near term.

• Gas storage currently sits at 29% (March 14th, 2026)
• The Injection Crisis - March usually marks the beginning of the "injection season" (refilling tanks for next winter). However, with TTF front-month prices up 55% (surpassing €50/MWh), it is currently too expensive for utilities to buy gas for storage. This creates a high risk of a supply deficit for the winter of 2026–2027
• Trump demands others help secure Strait of Hormuz
• Iran May Allow Tankers Through Hormuz Only in Chinese Currency
• EU scrambles to curb energy costs as Iran war hits markets
• EU Weighs Looser Carbon Rules, State Aid to Cut Energy Costs
• March 19–20: European Council Summit - this is where the official "July 2026" reform timeline is expected to be finalized

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Investment Funds

• Investment funds decreased their net long position to +52.36m EUAs on February 27th (vs. +63.25 EUAs on February 27th).
• Gross short positions increased to -41.44m EUAs (vs  -36.62m EUAs).
• Gross long positions decreased to 93.8m EUAs (vs. 99.88m  EUAs).
  
  

Market Prices

• Indicative Dec26 EUA Price: €
• Indicative Spot EUA Price: €
• YTD Spot EUA Price: € 78.12
• MTD Spot EUA Price:  € 69.517

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Chart A: December 2026 EUA Price (EUR)

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Technical Analysis

From a technical perspective, EUAs are currently trading within a range of €68–€74. With Bollinger Bands narrowing and both RSI and MACD in neutral territory, the market appears likely to continue moving sideways in the near term.

It is also important to note that trading volumes during red candlesticks have been higher than those during green candlesticks, indicating that bearish pressure and dip-buying activity are stronger than bullish momentum. There is a possibility that the Dec-26 contract could briefly fall below €68, although such a move would likely be short-lived if fundamentals remain unchanged, as dip buyers may step in.

On the upside, €74 appears to be a strong resistance level. If prices move above €73, the market could see profit-taking, potentially pushing prices back toward the low €70s.

At present, the market is being driven more by fundamental developments, with participants waiting for outcomes from the summit on the 19th and monitoring geopolitical developments in the Middle East.

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Chart B: December 2026 EUA Price (EUR) - Technical

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