Ethanol Blending: Petrol Would Cost ₹125 Without It, Govt

Govt defends ethanol blending: “petrol would cost ₹125/litre without it”

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Battle Brief

The Petroleum Ministry defended the Ethanol Blended Petrol (EBP) Programme on 31 July 2026. It said that when the Indian crude basket hit about US$135 a barrel, unblended petrol would have cost about ₹125 a litre in Delhi. Consumers paid ₹94.77 instead. It also said only surplus or damaged grain goes to ethanol, after food security needs.

Fact File

Released: 31 Jul 2026, Petroleum Ministry
Price claim: about ₹125 a litre without blending vs ₹94.77 paid (Delhi)
Crude basket peak: around US$135 a barrel
Forex saved: more than ₹1.97 lakh crore
Crude replaced: over 316 lakh metric tonnes
Import dependence: nearly 88% of oil needs

In the news

The Ethanol Blended Petrol programme: what happened?

Ethanol blending has two long-running debates: food versus fuel, and cost. The Ministry answered both. Ethanol is bought at stable, pre-agreed prices, so it acted as insurance when global crude spiked. And grain goes to distilleries only after the PDS, NFSA, welfare schemes and buffer stocks are covered.

Only surplus grain certified by the Department of Food and Public Distribution, plus damaged or broken grain, is approved for ethanol.
FCI rice’s share in ethanol rose from 0.02% in ESY 2023-24 to 24.64% in ESY 2025-26, when surplus stocks were available.
Maize’s share fell from 42.6% to 35.96% over the same period.
The PM JI-VAN Yojana supports 2G ethanol from crop residue.
Payments to farmers and distillers exceed ₹1.66 lakh crore; CO2 cut by over 950 lakh metric tonnes.

Back Story

What price does each feedstock fetch?

Ethanol price by feedstock, ESY 2025-26 (PIB, MoPNG, 31 Jul 2026)
Feedstock	Price per litre
Maize	₹71.86
Sugarcane juice/syrup	₹65.61
Damaged foodgrains	₹64.00
B-heavy molasses	₹60.73
FCI rice	₹60.32
C-heavy molasses	₹57.97

Why examiners care

Why does the Ethanol Blended Petrol programme matter?

Energy security: Domestic ethanol cushions global crude shocks.
Food security: Ministry says PDS and buffer needs are met first.

Exam Radar

What can Prelims ask on the Ethanol Blended Petrol programme?

EBP: about 20% of each litre was domestic ethanol during the price surge.
FCI rice share: 0.02% (ESY 2023-24) to 24.64% (ESY 2025-26).
PM JI-VAN Yojana: 2G ethanol from agricultural residue.

How to use this in Mains

GS-III Agriculture: cropping, MSP, PDS, food processing, land reforms

As per PIB (2026-07-31): moPNG said the Ethanol Blended Petrol programme balances food security, farmers and energy security, and claimed petrol would have cost ~₹125/litre during the oil price surge without blending.
Two debates follow ethanol everywhere: food versus fuel, and whether older vehicles can take higher blends.

Quotable data point
MoPNG said the Ethanol Blended Petrol programme balances food security, farmers and energy security, and claimed petrol would have cost ~₹125/litre during the oil price surge without blending.
PIB: MoPNG: ethanol blending clarification, 31 Jul 2026

Practice MCQs

Original practice questions (not PYQs).

Practice · UPSC

The Pradhan Mantri JI-VAN Yojana is associated with

Answer (b) & explanation

PIB (MoPNG), 31 Jul 2026.

Quick questions

Questions students ask about this

What did the Ministry claim about petrol prices?

That without blending, petrol would have cost around ₹125 a litre in Delhi when crude hit about US$135 a barrel; consumers paid ₹94.77.

Does ethanol use grain meant for the poor?

The Ministry says no: only certified surplus and damaged or unfit grain is used, after PDS, NFSA, welfare and buffer needs.

What is 2G ethanol?

Ethanol made from agricultural residue, promoted under the PM JI-VAN Yojana to reduce dependence on food grains.