Emissions, Election Odds, and The EPA

EPA finalizes Waste Emissions Charge rules as directed by the IRA while market carbon prices respond to the US presidential race

November 12, 2024 • Est. Reading Time: 3 minutes

Mobius Intel Brief:

The Environmental Protection Agency (EPA) announced final rules Tuesday to implement the Waste Emissions Charge (WEC) applied to oil and gas facilities that report methane emissions above 25,000 metric tons of carbon dioxide equivalent per year (CO2eq) and exceed specified methane intensity levels.

  • Key Intel: The EPA’s charges express price levels above those used by the IRS and are over 100x the market-determined cost of carbon according to CME’s Global Emissions Offset (GEO) — prices of which closely tracked betting odds for this year’s presidential election (shown below). The EPA’s final WEC rule will likely prove short-lived under a second Trump administration with a unified Republican government and overturned Chevron Deference.

Subscribe to Mobius Market Research Pro
to access this report and receive future analyst notes.

WWMD: What Would Mobius Do?

Mobius was founded in 2002 by a cadre of risk management and commodity trading experts. We monitor real-time global market data 24/7/365 to deliver exclusive strategy and analytics to our energy, metals, and agriculture clients.

This commentary contains our views and opinions and is based on information from sources we believe are reliable. This commentary is for informational purposes, should not be considered investment advice, and is not intended as an offer or solicitation with respect to the purchase and sale of commodity interests or to serve as the basis for one to decide to execute derivatives or other transactions. This commentary is exclusively intended for Mobius clients and is not considered promotional material.