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Informist, Saturday, Jul. 11, 2026

 

MUMBAI – The government has said it cannot offer consumers the option to buy pure petrol along with ethanol-blended fuels at most pumps due to logistical challenges in India's fuel distribution network. Maintaining multiple grades of base petrol across the vast supply chain would increase handling costs, complicate inventory management, and reduce operational efficiency.

 

"The suggestion that every petrol pump should stock pure petrol, E10, and E20 simultaneously also ignores the realities of India's fuel distribution network," the petroleum ministry said, adding that the country has over 100,000 retail outlets, supported by an extensive network of refineries, terminals, depots, and pipelines.

 

The government said public demand to ensure pure petrol is available at pumps, similar to premium petrol, is "misplaced". "Premium fuels are niche products sold in limited quantities at a significant price premium because specialised performance-enhancing additives are blended into them," the ministry said in a release. 

 

The government also rejected the proposition of creating a parallel nationwide supply chain for pure petrol, E10, and E20, arguing it was not in the nation's interest. Over the past several years, public sector banks have financed nearly INR 1 trillion per annum in ethanol production and associated infrastructure.

 

"If, after creating this capacity, we were to arbitrarily revert to E10, what happens to these investments? What happens to the surplus production capacity? What happens to thousands of crores invested by farmers, cooperatives, entrepreneurs, financial institutions, and public sector companies in good faith based on a national policy," the ministry argued. 

 

The government admitted that E20 reduced mileage for some vehicles, but argued it was only one parameter of fuel efficiency. E20 offers a significantly higher-octane rating, superior anti-knock characteristics, faster combustion, better pickup, smoother acceleration, and cleaner engine operation, the ministry said. 

 

On consumer demand to price E20 cheaper than pure petrol, the government said E20 is costlier to produce than petrol when crude oil prices trade around $70 per barrel. "If crude rises to $$120–$130 per barrel, the economics naturally reverse and ethanol becomes even cheaper," it added. The government said India's ethanol blending programme reduced consumers' exposure to volatile crude oil prices. 

 

The government said India did not rush into adopting the ethanol blending programme. But the adoption of higher ethanol-blended fuels was faster than Brazil and the US, as India had the advantage of learning from global experience and proven technologies. 

 

"This has been a journey spanning over two decades from pilot projects in 2001, policy notification in 2013, institutional reforms after 2018, massive investments beginning in 2021, and then a carefully calibrated, phased increase in blending levels," the ministry said. End

 

Reported by Afra Abubacker

Edited by Akul Nishant Akhoury

 

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