1. Total Weekly Volume of 3.57 M tons -2.2% WoW change
2. RGGI ICE weekly average settlement price was $14.01, +0.22% WoW.
3. Managed Money increases net-short positions by 0.37 M tons, and compliance entities increase net-long by 0.21 M tons.

Quick Summary:

RGGI’s futures prices increased slightly over the week. The slight upbeat is in sync with financial markets, as the Nasdaq rose 8% last week. The RGGI remains bound by the Cost-Containment Reserve boundaries, which is $13.91 in 2022 and will chnage to $14.88 in 2023. The front contract ended the week at $13.89, just 2 cents below this critical pricing point. The Volumes trading on the ICE index remains steady (-2.2% WoW). CFTC shows managed money increased net short positions by 0.37 M tons, while compliance entities increased net long positions by 0.21 M tons.

As we approach July 1^st, Virginia’s Governor Glenn Younkin is expected to bring forward an emergency resolution to the Virginia Air Pollution Board, in an attempt to remove the state from the RGGI. Pennsylvania too is facing multiple lawsuits against joining the RGGI. The outcomes of these challenges against the RGGI, will impact the RGGI market in the coming weeks.

Market Fundamental

CFTC DATA

• Open interest increased (2.5%) to 78.1M tons from 76.19 M tons, over the last two weeks.  
• Compliance entities increased long positions to 37.78 M tons from 35.75 M tons (5.67%), and short positions to 12.67 M tons to 10.97 M tons (15.5%). The net change of compliance entities is positions with net long positions increasing by 0.21 M tons (1.91 M tons-1.7 M tons).
• Managed money increased to 10.98 M tons from 10.88 M tons (+0.88%), and short positions to 5.76 M tons to 5.29 M tons (8.8%). Managed money opened 0.37 M tons more net short positions, over the last two weeks.  

The RGGI prices have maintained their prices since the start of 2022, even as most global indexes retreated as fears of recession and interest rate hikes remain widespread. Over the next few weeks, more clarity on the status of Virginia and Pennsylvania will drive market interest.

Analyst: Craig Rocha (cmrocha@californiacarbon.info)