India's Shift Towards Ethanol Amid Iran War Energy Crisis
Iran war energy shock drives India's interest in ethanol and other biofuels
The Economic Times
Image: The Economic Times
The ongoing Iran war has disrupted global fuel supplies, leading India to explore higher ethanol blending in fuels to mitigate rising energy costs. With cooking gas prices tripling for consumers like taxi driver Ravi Ranjan in New Delhi, the government is pushing for up to 100% ethanol in vehicles to enhance energy security and reduce reliance on imported crude oil.
- 01Rising fuel prices due to the Iran war are significantly impacting Indian consumers.
- 02India is proposing higher ethanol blends in fuels to reduce dependence on imported oil.
- 03The government aims for a 20% ethanol blend by 2025, with plans to increase it to 27% by 2030.
- 04Concerns remain about the impact of higher ethanol blends on vehicle mileage and food supply.
- 05Southeast Asian countries are also increasing biofuel blending to combat energy disruptions.
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The Iran war has caused significant disruptions in global fuel supplies, leading to skyrocketing prices for cooking gas and gasoline in India. Taxi driver Ravi Ranjan from New Delhi now pays ₹3,000 ($31) for a liquid petroleum gas cylinder, up from ₹1,000 ($11). In response, the Indian government is advocating for increased ethanol blending in fuels, proposing blends of up to 100% ethanol to enhance energy security and reduce reliance on imports. Currently, 20% ethanol blends are available at most fuel pumps, with a target to increase this to 27% by 2030. However, concerns persist regarding the impact on vehicle mileage and the competition for crops used in ethanol production with food supplies. Meanwhile, Southeast Asian nations like Indonesia and Malaysia are also pursuing biofuel initiatives to shield themselves from energy crises. The shift towards biofuels, while promising, raises questions about environmental sustainability and the long-term viability of such solutions.
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The rising fuel prices are straining household budgets, forcing consumers to spend more on essential cooking fuel and transportation, impacting their daily lives.
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