India's Ethanol Blended Petrol (EBP) Programme has emerged as a key pillar of the country's energy transition and biofuel strategy, saving over Rs 1.90 lakh crore in foreign exchange by reducing crude oil imports while boosting farmers' incomes and cutting carbon emissions, according to a government factsheet issued on Sunday.
From 2014-15 to May 2026, the ethanol blending programme helped save more than Rs 1.90 lakh crore in foreign exchange by substituting 310 lakh metric tonnes of imported crude oil. It also generated additional earnings of over Rs 1.6 lakh crore for farmers and reduced carbon emissions by more than 930 lakh metric tonnes.
The government noted that India imports nearly 88.5 per cent of the crude oil it consumes, making ethanol blending a key policy priority to reduce dependence on imported fuel and shield the country from global price volatility and supply disruptions. Ethanol produced from domestically grown sugarcane, maize and rice offers a sustainable alternative while creating new market opportunities for farmers.
The factsheet also highlighted that ethanol blending is now a globally accepted practice. In the United States, E10 is the standard fuel nationwide, while E15 is being rapidly expanded, with millions of flex-fuel vehicles capable of running on blends up to E85. Brazil, the global leader in ethanol use, mandates E27 petrol and is moving towards a 35 per cent blend, with over 80 per cent of new vehicles being flex-fuel. Japan has also adopted ethanol blending through a phased rollout of E10, while Canada, Thailand and several European countries have incorporated ethanol blending into their clean fuel strategies.
The government's push for ethanol comes as global oil markets continue to evolve. OPEC+ is expected to consider another modest increase in oil production quotas for August as the alliance gradually unwinds supply cuts introduced in 2023.
According to delegates, seven key producers led by Saudi Arabia and Russia have reached a preliminary agreement to increase the combined production target by 188,000 barrels per day, subject to approval at a virtual meeting on Sunday.
If approved, the move would raise cumulative quota additions since the policy reversal began to around 940,000 barrels per day, equivalent to nearly one per cent of global oil demand.
Earlier production increases had remained largely on paper due to disruptions caused by regional conflicts and the closure of the Strait of Hormuz. However, the recent easing of tensions following an interim peace agreement between the United States and Iran has enabled major Gulf producers to restore exports and output.
Saudi Arabia and the United Arab Emirates have already brought oil exports close to pre-conflict levels, supported by improved shipping access through the Strait of Hormuz. The additional supplies have eased earlier concerns over shortages, resulting in a surplus in key Asian markets, reversing the sharp spike in oil prices seen during the conflict and increasing competition among OPEC producers for market share.
The proposed increase also comes amid internal challenges within OPEC+. Iraq has indicated it could eventually consider leaving the group if it is not granted a higher production quota, while the United Arab Emirates had previously exited the alliance in May over similar concerns regarding production limits.
If approved, the August increase would mark the penultimate phase of restoring the production cuts introduced in 2023, with one final increase expected in September to complete the process.
