NEW DELHI: The Centre on Friday said ethanol blending helped cushion consumers from the impact of soaring global crude oil prices, arguing that petrol in Delhi would have cost around Rs 125 a litre when crude touched $135 a barrel if ethanol had not been blended with the fuel.
Defending the ethanol blending programme against what it termed “misleading” claims over costs, food security and taxpayer subsidies, the petroleum ministry said consumers paid Rs 94.77 per litre because 20% of every litre of petrol comprised domestically produced ethanol procured at pre-agreed prices. According to the ministry, this helped shield retail fuel prices from the global crude price spike, resulting in savings of nearly Rs 30 per litre at the pump during the peak of the crisis.
The ministry noted that the government kept petrol and diesel prices unchanged for nearly 75 days after the West Asia conflict began on February 28 before increasing prices by Rs 7.5 per litre in May. It added that standard 91-octane E20 petrol currently costs Rs 102.12 per litre in Delhi, while 100-octane petrol is priced at Rs 169 per litre.
The ministry also rejected allegations that foodgrains meant for the poor were being diverted for ethanol production or that subsidised rice supplied by the Food Corporation of India (FCI) was being used to support the blending programme.
