EU allowances broke out of their recent range to a nine-day high on Friday amid slowly building bullish sentiment, then gave back those gains Monday morning as energy markets firmed on another European heatwave and a Strait of Hormuz still largely closed to free navigation, per Carbon Pulse's Euro Markets coverage. A Carbon Pulse analyst poll showed near-term EUA forecasts revised up after the European Commission's proposed ETS overhaul proved less damaging to near-term supply than feared, with longer-term expectations cut. In the voluntary market, the quality of newly issued credits improved sharply at the start of Q3 on landfill gas and solar issuances, even as trading stayed subdued and prices weakened across much of the market; fresh supply is shrinking as developers adapt to new methodologies, and H1 2026 issuances were the lowest in over five years, narrowing the gap to retirements. Australia opened its Safeguard Mechanism review, weighing ACCU limits and vintaging.
In base oils, the US market remains exceptionally tight. Lubes'N'Greases' Weekly Americas report (August 5) records Motiva raising Group II+/III postings 50 cents/gal effective August 1, SK Enmove following on August 3, and Avista lifting its Group III posting by $1.00/gal — all on tight global availability and elevated crude. Re-refiners have been sold out for weeks, with re-refined barrels increasingly bridging the gap left by virgin producers. WTI September settled at $75.77/bbl on August 4; Brent at $90.12/bbl on August 5. Our indicative CXF US Gulf assessment stands at $21.70/t and CXF re-refining credits at $19.90/t (desk marks, updated August 6).
Takeaway: with re-refined output fully committed and posted prices rising, collectors and re-refiners hold pricing leverage — favor term offtake over spot. Buyers should not count on spot availability returning while Group III scarcity persists.
Indicative desk marks — not financial advice. Current levels: CXF Price Index.