Ethanol Blending Averted Rs 125 Petrol Spike, Says Government
OIL & GAS

Ethanol Blending Averted Rs 125 Petrol Spike, Says Government

The Ministry of Petroleum and Natural Gas defended the Ethanol Blended Petrol programme and said retail petrol prices in Delhi could have reached around Rs 125 per litre during peak global crude spikes if ethanol blending had not been implemented. It said the measure provided nearly Rs 30 per litre in savings at the pump when the Indian crude basket rose to about USD 135 per barrel, with consumers paying Rs 94.77 per litre because 20 per cent of every litre consisted of domestically produced ethanol procured at stable pre-agreed prices. The ministry characterised the scheme as a buffer against extreme international price volatility rather than a daily cheapest fuel option.

It argued that ethanol blending strengthens India's energy security and keeps more of the country's fuel bill within the domestic economy rather than sending it overseas. The ministry pointed to the programme's role in insulating consumers from shocks during the crude price surge and in creating predictable demand for agricultural feedstock. It also addressed concerns over food security and subsidies, saying the policy is not a taxpayer subsidy but an element of national energy insurance.

The statement said the EBP programme has yielded over Rs 1.97 trillion (tn) in foreign exchange savings, substituted more than 31.6 million (mn) t of crude imports and reduced CO2 emissions by over 95 million (mn) t. These gains were presented as evidence that the blending drive both cut import bills and delivered environmental benefits.

The ministry added that the initiative has driven over Rs 1.66 tn in direct payments to farmers and distillers, helping to establish a reliable domestic marketplace for feedstock and value addition within India. It said this market support has aided rural incomes while decreasing the country's import dependence on crude oil to 88 per cent. Officials framed the programme as contributing to energy sovereignty and economic resilience amid volatile international markets.

The Ministry of Petroleum and Natural Gas defended the Ethanol Blended Petrol programme and said retail petrol prices in Delhi could have reached around Rs 125 per litre during peak global crude spikes if ethanol blending had not been implemented. It said the measure provided nearly Rs 30 per litre in savings at the pump when the Indian crude basket rose to about USD 135 per barrel, with consumers paying Rs 94.77 per litre because 20 per cent of every litre consisted of domestically produced ethanol procured at stable pre-agreed prices. The ministry characterised the scheme as a buffer against extreme international price volatility rather than a daily cheapest fuel option. It argued that ethanol blending strengthens India's energy security and keeps more of the country's fuel bill within the domestic economy rather than sending it overseas. The ministry pointed to the programme's role in insulating consumers from shocks during the crude price surge and in creating predictable demand for agricultural feedstock. It also addressed concerns over food security and subsidies, saying the policy is not a taxpayer subsidy but an element of national energy insurance. The statement said the EBP programme has yielded over Rs 1.97 trillion (tn) in foreign exchange savings, substituted more than 31.6 million (mn) t of crude imports and reduced CO2 emissions by over 95 million (mn) t. These gains were presented as evidence that the blending drive both cut import bills and delivered environmental benefits. The ministry added that the initiative has driven over Rs 1.66 tn in direct payments to farmers and distillers, helping to establish a reliable domestic marketplace for feedstock and value addition within India. It said this market support has aided rural incomes while decreasing the country's import dependence on crude oil to 88 per cent. Officials framed the programme as contributing to energy sovereignty and economic resilience amid volatile international markets.

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