India Considers E10 Petrol for Older Cars Amid Supply Chain Review

The Indian government and oil marketing companies (OMCs) are actively reviewing the introduction of E10 petrol for older vehicles, to be offered concurrently with the existing E20 blend. This evaluation, confirmed by Bharat Petroleum Corporation (BPCL) Chairman and Managing Director Sanjay Khanna, focuses on managing the complex supply chain required for dual distribution.

Navigating Dual Fuel Supply

While current infrastructure can manage a switch to a lower ethanol blend like E10, the primary obstacle identified by Khanna is the intricate supply chain management. This involves distributing two distinct motor spirit grades, E10 and E20, simultaneously across the nation’s extensive fuel network.

• Ensuring sufficient supplies of both E10 and E20 blends.
• Logistical challenges for OMCs in managing two separate grades.
• Increased logistics complexity, inventory, and handling costs across over one lakh retail outlets, as previously highlighted by the government.

These discussions have gained momentum following Chief Economic Adviser V Anantha Nageswaran’s advocacy for reintroducing a lower-blend option, particularly for older vehicles. India successfully achieved its 20% ethanol blending target last year, five years ahead of schedule.

• 20%: Ethanol blending target achieved last year.
• 5 years: Ahead of initial deadline for 20% target.
• 43 million tonnes: Petrol consumption in the last financial year.

BPCL’s Diversified Sourcing

In a related development, BPCL has reported secure crude and LPG supplies, attributing this stability to diversified sourcing strategies amidst ongoing geopolitical volatility. The company confirmed it has finalized crude procurement for September and secured approximately 50% of its October requirements.

• Approximately 60% of current crude needs are met through the spot market to cover term supply shortfalls.
• Secured its first Iraqi crude cargo for FY27, a one-million-barrel shipment, currently en route for ship-to-ship transfer.
• Plans to explore more such cargoes when insurance, vessel availability, and economics are favorable.

The ongoing evaluations for E10 petrol underscore the dynamic nature of India’s fuel policy, balancing environmental targets with practical distribution challenges. Meanwhile, BPCL’s proactive sourcing illustrates strategic resilience in a volatile global energy landscape.