Ethanol Blending Saved Consumers Rs 30/Litre During Crude Spike: Govt
UPSC / SSC current affairs note · Economy
Why in news
The petroleum ministry defended ethanol blending, stating it saved consumers nearly Rs 30 per litre on petrol when global crude prices hit $135 a barrel. This comes amid allegations about the programme's costs, food security impact, and alleged subsidies.
Background
Ethanol blending in India has been promoted to reduce oil import dependence and provide cleaner fuel. The government has targeted 20% ethanol blending (E20) by 2025-26, with current blending at 20% as per the report.
Key facts
Petrol would have cost around Rs 125 per litre in Delhi if not for ethanol blending, when global crude touched $135 a barrel.
Consumers paid Rs 94.77 per litre due to 20% ethanol blending, resulting in nearly Rs 30 per litre savings.
The government kept petrol and diesel prices unchanged for nearly 75 days after the West Asia conflict began on Feb 28, before raising them by Rs 7.5 per litre in May.
E20 petrol (91-octane) costs Rs 102.12 per litre in Delhi; 100-octane petrol is Rs 169 per litre.
The ministry rejected allegations of foodgrain diversion for ethanol production and use of subsidised FCI rice.
Ethanol is domestically produced and procured at pre-agreed prices, shielding retail prices from global crude spikes.
Prelims pointers
- E20: 20% ethanol blended petrol
- Ethanol blending programme: aimed at reducing oil imports, cleaner fuel
- FCI: Food Corporation of India
- West Asia conflict: started Feb 28 (year not specified, likely 2026)
- Petrol price in Delhi: Rs 102.12 per litre (E20)
- Crude price: $135 per barrel
Mains angles
- Discuss the role of ethanol blending in India's energy security and its impact on fuel pricing.
- Critically examine the allegations of food security vs. ethanol production trade-off.
- Evaluate the government's policy of keeping fuel prices stable during global crises.