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Average European gas storage levels have now fallen below 50%

Current levels are only marginally above the “record-low” levels seen in 2022, and more than 10 percentage points below the already weak 2025 levels.
The extreme cold weather experienced in recent weeks, combined with forecasts pointing to persistently low temperatures, is further intensifying concerns around the pace of storage withdrawals. These worries are compounded by geopolitical risks, missing French nuclear capacity, and below-average renewable generation.

At the same time, TTF front-month prices have risen by more than one third since the beginning of the year. Based on recent years’ experience, there is a strong correlation between storage withdrawals and TTF FM price movements.
We continue to closely monitor weather and market forecasts and report on all key developments in our daily market updates.

Written by: Tóth Eszter Lilla

2026.01.20.

EU environment ministers have adopted a joint negotiating position on the 2040 emissions reduction target, providing more flexibility to member states compared to the European Commission’s earlier proposal.

Main Elements of the Agreement

•  90% emissions reduction by 2040 compared to 1990 levels. At least 85% to be achieved through domestic measures.Up to 5% through high-quality international carbon credits (pilot phase 2031–2035, full use from 2036). This represents greater flexibility than the European Commission’s initial proposal, which would have allowed only 3% credit use. The Council emphasizes that the target should remain legally binding, while acknowledging variations in competitiveness, social impacts, and national circumstances.

Why does this matter?

Expanding the credit allowance gives industries and member states more room to manage their decarbonization pathways. However, it raises questions about whether this could slow down domestic clean investment efforts.

EU ETS2 Launch Delay: 2027 ➜ 2028

• Ministers propose delaying the start of the new emissions trading system covering buildings and road transport by one year.

Rationale: Shielding households and small businesses amid ongoing energy price volatility.

Additional points discussed:

• A slower phase-out of free allowances for heavy industry under the existing ETS A review clause to address energy price impacts on competitiveness and consumers.

What’s Next?

• The European Parliament will vote on its negotiating mandate next week. A final compromise will be shaped in trilogue negotiations between the Parliament, Council, and Commission in the coming months.

Bottom line:

The ambition remains high, but the transition path is becoming more pragmatic, with stronger focus on social acceptance and economic resilience.

EU environment ministers have adopted a joint negotiating position on the 2040 emissions reduction target, providing more flexibility to member states compared to the European Commission’s earlier proposal.

Main Elements of the Agreement

•  90% emissions reduction by 2040 compared to 1990 levels. At least 85% to be achieved through domestic measures.Up to 5% through high-quality international carbon credits (pilot phase 2031–2035, full use from 2036). This represents greater flexibility than the European Commission’s initial proposal, which would have allowed only 3% credit use. The Council emphasizes that the target should remain legally binding, while acknowledging variations in competitiveness, social impacts, and national circumstances.

Why does this matter?

Expanding the credit allowance gives industries and member states more room to manage their decarbonization pathways. However, it raises questions about whether this could slow down domestic clean investment efforts.

EU ETS2 Launch Delay: 2027 ➜ 2028

• Ministers propose delaying the start of the new emissions trading system covering buildings and road transport by one year.

Rationale: Shielding households and small businesses amid ongoing energy price volatility.

Additional points discussed:

• A slower phase-out of free allowances for heavy industry under the existing ETS A review clause to address energy price impacts on competitiveness and consumers.

What’s Next?

• The European Parliament will vote on its negotiating mandate next week. A final compromise will be shaped in trilogue negotiations between the Parliament, Council, and Commission in the coming months.

Bottom line:

The ambition remains high, but the transition path is becoming more pragmatic, with stronger focus on social acceptance and economic resilience.

EU environment ministers have adopted a joint negotiating position on the 2040 emissions reduction target, providing more flexibility to member states compared to the European Commission’s earlier proposal.

Main Elements of the Agreement

•  90% emissions reduction by 2040 compared to 1990 levels. At least 85% to be achieved through domestic measures.Up to 5% through high-quality international carbon credits (pilot phase 2031–2035, full use from 2036). This represents greater flexibility than the European Commission’s initial proposal, which would have allowed only 3% credit use. The Council emphasizes that the target should remain legally binding, while acknowledging variations in competitiveness, social impacts, and national circumstances.

Why does this matter?

Expanding the credit allowance gives industries and member states more room to manage their decarbonization pathways. However, it raises questions about whether this could slow down domestic clean investment efforts.

EU ETS2 Launch Delay: 2027 ➜ 2028

• Ministers propose delaying the start of the new emissions trading system covering buildings and road transport by one year.

Rationale: Shielding households and small businesses amid ongoing energy price volatility.

Additional points discussed:

• A slower phase-out of free allowances for heavy industry under the existing ETS A review clause to address energy price impacts on competitiveness and consumers.

What’s Next?

• The European Parliament will vote on its negotiating mandate next week. A final compromise will be shaped in trilogue negotiations between the Parliament, Council, and Commission in the coming months.

Bottom line:

The ambition remains high, but the transition path is becoming more pragmatic, with stronger focus on social acceptance and economic resilience.

EU environment ministers have adopted a joint negotiating position on the 2040 emissions reduction target, providing more flexibility to member states compared to the European Commission’s earlier proposal.

Main Elements of the Agreement

•  90% emissions reduction by 2040 compared to 1990 levels. At least 85% to be achieved through domestic measures.Up to 5% through high-quality international carbon credits (pilot phase 2031–2035, full use from 2036). This represents greater flexibility than the European Commission’s initial proposal, which would have allowed only 3% credit use. The Council emphasizes that the target should remain legally binding, while acknowledging variations in competitiveness, social impacts, and national circumstances.

Why does this matter?

Expanding the credit allowance gives industries and member states more room to manage their decarbonization pathways. However, it raises questions about whether this could slow down domestic clean investment efforts.

EU ETS2 Launch Delay: 2027 ➜ 2028

• Ministers propose delaying the start of the new emissions trading system covering buildings and road transport by one year.

Rationale: Shielding households and small businesses amid ongoing energy price volatility.

Additional points discussed:

• A slower phase-out of free allowances for heavy industry under the existing ETS A review clause to address energy price impacts on competitiveness and consumers.

What’s Next?

• The European Parliament will vote on its negotiating mandate next week. A final compromise will be shaped in trilogue negotiations between the Parliament, Council, and Commission in the coming months.

Bottom line:

The ambition remains high, but the transition path is becoming more pragmatic, with stronger focus on social acceptance and economic resilience.

EU environment ministers have adopted a joint negotiating position on the 2040 emissions reduction target, providing more flexibility to member states compared to the European Commission’s earlier proposal.

Main Elements of the Agreement

•  90% emissions reduction by 2040 compared to 1990 levels. At least 85% to be achieved through domestic measures.Up to 5% through high-quality international carbon credits (pilot phase 2031–2035, full use from 2036). This represents greater flexibility than the European Commission’s initial proposal, which would have allowed only 3% credit use. The Council emphasizes that the target should remain legally binding, while acknowledging variations in competitiveness, social impacts, and national circumstances.

Why does this matter?

Expanding the credit allowance gives industries and member states more room to manage their decarbonization pathways. However, it raises questions about whether this could slow down domestic clean investment efforts.

EU ETS2 Launch Delay: 2027 ➜ 2028

• Ministers propose delaying the start of the new emissions trading system covering buildings and road transport by one year.

Rationale: Shielding households and small businesses amid ongoing energy price volatility.

Additional points discussed:

• A slower phase-out of free allowances for heavy industry under the existing ETS A review clause to address energy price impacts on competitiveness and consumers.

What’s Next?

• The European Parliament will vote on its negotiating mandate next week. A final compromise will be shaped in trilogue negotiations between the Parliament, Council, and Commission in the coming months.

Bottom line:

The ambition remains high, but the transition path is becoming more pragmatic, with stronger focus on social acceptance and economic resilience.