Carbon (emissions permits) Falls as Climate Failure Is Oil Polluter Boon

[phantom power]

Jan. 19 (Bloomberg) -- The inability of government leaders to agree on stricter pollution controls at meetings in Copenhagen last month is showing up in commodity markets, where it’s getting cheaper to emit greenhouse gasses.

The price of permits to emit a ton of carbon dioxide sank 10 percent in London, while oil gained 6 percent in New York since Dec. 7, when 8,000 delegates attended a summit in the Danish capital to prepare for a successor to the Kyoto Protocol, the climate treaty that expires in 2012. Not only did the summit fail to increase regulation on polluters, it also reduced incentives to invest in clean energy.

Carbon and oil prices are diverging the most in three years and their correlation this year will be weaker than in 2009, according to a Bloomberg News survey of seven analysts. The European Union, which tried to reduce emissions by limiting the allocation of carbon allowances to companies, may be stuck with a 2.3 percent surplus just as economies from China to Brazil drive crude near $80 a barrel, the survey showed.

“There are surely two factors impacting carbon prices: the failed summit in Copenhagen and a probable surplus in the EU emissions-trading system,” said Jacek Kaczorowski, chief executive officer of Poland’s Belchatow coal-fired power plant, the biggest polluter in Europe, according to EU data. Any “sustainable recovery” in carbon markets is unlikely this year, he said.

http://www.bloomberg.com/apps/news?pid=20601072&sid=a7ICxbCZDcyI

[Nihil]

1. "Mission accomplished" ... thanks guys ... (n/t)

:grr:

[joshcryer]

2. Thanks for the kick, didn't see this. Business as usual.