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Ethanol Industry Proposes Over 20% Petrol Blending As West Asia War Causes Oil Price Spike
India's ethanol industry has told the government it is ready to supply petrol with more than 20 per cent ethanol blended into it, as crude oil prices remain volatile amid tensions in West Asia caused by the war between Iran and the alliance of Israel & United States.
According to a report by PTI, the proposal has been made by the All India Distillers' Association (AIDA), which has written to Union Road Transport Minister Nitin Gadkari.
The industry body said increasing ethanol blending beyond current levels could directly reduce India's dependence on crude oil imports. The move is being positioned as a way to manage both supply risks and rising fuel costs linked to global market fluctuations caused by the war in West Asia.
India achieved its E20 target in 2025, five years ahead of the original timeline set for the blend. The AIDA has now proposed moving beyond this level, with a phased increase towards 30 per cent ethanol blending in petrol.
The association stated that the industry is prepared to supply higher volumes of ethanol immediately. The AIDA has also proposed accelerating the rollout of flex-fuel vehicles that can run on higher ethanol blends, similar to the ones sold in Brazil. These vehicles are capable of operating on a range of ethanol concentrations, including up to 100 per cent ethanol, depending on the configuration.
The AIDA has further suggested expanding ethanol use beyond conventional transport fuels. This includes the introduction of ethanol-based cooking fuel solutions for domestic and commercial use, as well as exploring ethanol blending in diesel.
India's ethanol production capacity currently stands at around 2,000 crore litres. India currently has more than 380 operational distilleries, with additional units under development. The industry body indicated that this level of capacity is sufficient to support higher blending targets. It also noted that supply can be scaled further if policy support and demand increase in line with higher blending mandates.
Drivespark Thinks
The All India Distillers' Association's proposal comes amid continued volatility in global oil markets. With India heavily dependent on crude imports, higher ethanol blending is being presented by ethanol producers as a way to reduce exposure to price fluctuations while strengthening domestic energy supply. However, getting these blends to work with our vehicles will require quite a bit of work, which in turn, would lead to another increase in prices and could also cause problems with older vehicles that are not compatible with these E20+ petrol blends.
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