In this week's Market Movers Asia with Barbara Lorenzo Caluag:
- India Renewable Energy Carbon credit prices drop
- New Zealand to hold carbon allowance auction NZU
- Refiners await Aramco’s Jan-loading crude OSP differentials
- Evergrande decision looms over China steel market
- Stable thermal coal demand from Chinese power plants
This week, carbon market sources continue to keep a close eye on developments at COP28 as they decide on trading strategies going forward.
In India, prices of renewable carbon credits dropped over the past week as some project developers were selling.
In New Zealand, the last carbon allowance auction for 2023 is scheduled for Dec. 6. The auction comes after the New Zealand Unit price touched a nine-month high of NZ$74.61/mtCO2e on Nov. 30, the highest since Platts launched the assessment in March.
In oil, Asian refiners await the release of Saudi Aramco’s official selling price differentials for January-loading crude.
Many traders and refinery feedstock managers expect cuts of at least $1/b for the Saudi Arab Light grade.
Sources indicated that the OPEC kingpin's decision to keep its voluntary crude production cut at 1 million b/d and the ample light sweet US crude cargoes offered to Asia should put pressure on the OSPs.
Meanwhile, the fate of debt-stricken Evergrande could be decided at a court hearing in Hong Kong on Dec. 4, which could lead to the liquidation of the property developer, whose debt woes have affected steel demand in China.
The Asian thermal coal market is likely to see a stable demand from Chinese power plants amid falling temperatures, though some traders might wait in the hope of a price drop. Indian buyers are expected to follow the Chinese traders, which will keep spot imports to the South Asian country limited.
I’m Barbara Lorenzo Caluag, thank you for kicking off your Monday with S&P Global Commodity Insights.