Tag: Energy Security

  • India’s Ethanol Blending Program Saves Rs. 1.9 Lakh Crore in Foreign Exchange, Government Reports

    India’s Ethanol Blending Program Saves Rs. 1.9 Lakh Crore in Foreign Exchange, Government Reports

    The Indian government has announced that its ethanol blending program has saved the country approximately Rs. 1.9 lakh crore in foreign exchange by reducing the need for crude oil imports. The announcement comes as India expands the availability of E20 fuel across the nation.

    According to government officials, the Ethanol-Blended Petrol (EBP) program, which mixes ethanol derived from crops like sugarcane and maize with petrol, has significantly cut crude oil imports. Between 2014-15 and 2026, the program saved around Rs. 1.9 lakh crore in foreign exchange. Additionally, it led to a net reduction of approximately 930 lakh tonnes of CO2 emissions. The government also disbursed about Rs. 14,600 crore in subsidies to sugar mills from 2014-15 to 2020-21.

    C K Jain, President of the GEMA, stated, “The result showed that E20 is safe for all engines. It was executed and implemented after technical studies, pilot projects, policy discussions, and not in haste.”

    India imports most of its crude oil for petrol and diesel production, paying in foreign currency, primarily US dollars. By reducing imports, the country spends fewer dollars, easing pressure on foreign exchange reserves and strengthening the economy against global oil price volatility.

    The government’s renewed emphasis on ethanol blending comes amid the rollout of E20 fuel, which has sparked debate over vehicle compatibility, mileage, and maintenance costs. Some experts have called for a slower transition. However, the government aims to highlight the program’s broader benefits: reducing oil imports, supporting farmers, and enhancing energy security.

    With India’s continued push for E20, the discussion is expected to persist. For now, officials are focusing on long-term gains rather than short-term concerns.

  • India Lifts Emergency Gas Restrictions as LNG Flows Through Strait of Hormuz Resume

    India Lifts Emergency Gas Restrictions as LNG Flows Through Strait of Hormuz Resume

    The Indian government has withdrawn most of the emergency natural gas regulations it imposed earlier this year, following the resumption of liquefied natural gas (LNG) shipments through the Strait of Hormuz after a ceasefire in the West Asia conflict. The Ministry of Petroleum and Natural Gas issued a notification on Saturday amending the Natural Gas (Supply Regulation) Order, 2026, removing the operational provisions that had governed how domestic and imported gas was allocated across sectors.

    What Changes Now

    With a ceasefire in place, negotiations ongoing, and maritime traffic through Hormuz restored, the ministry determined that emergency measures were no longer necessary. The notification specifically cited the resumption of sea traffic through the strait as the basis for withdrawing the priority-customer framework that had overridden existing commercial gas contracts.

    This was the last of three emergency measures introduced during the crisis to be rolled back. The government had already lifted earlier restrictions directing refiners to maximize LPG output by diverting petrochemical feedstock, and curbs on diesel sales to bulk consumers, as supply conditions eased.

    “The ongoing conflict in the Middle East that had resulted in the disruption of liquefied natural gas shipments through the Strait of Hormuz has been subject to a ceasefire, and negotiations are ongoing, as part of which, sea traffic through the Strait of Hormuz has been permitted to be resumed,” the notification stated.

    Reasons Behind the Restrictions

    The original order was issued on March 9 under the Essential Commodities Act, after fighting between the US, Israel, and Iran triggered by strikes on Iran on February 28. Tehran’s retaliation disrupted LNG shipments passing through the Strait of Hormuz. Several suppliers invoked force majeure clauses and diverted cargoes elsewhere, prompting the government to step in with sector-wise gas rationing to protect priority consumers.

    Piped natural gas for households, CNG for transport, LPG production, and pipeline operations were guaranteed full supply based on their prior six-month average consumption, while sectors like petrochemicals and select power stations absorbed the resulting cutbacks.

    Why the Strait of Hormuz Matters for India’s Energy Security

    The episode underscored how exposed India remains to disruptions along the Hormuz corridor despite years of energy diversification efforts. The country imports about 88% of its crude oil needs and roughly half of its natural gas requirement, with West Asia supplying 40-45% of its crude oil imports and nearly 65% of its LNG.

    While India was able to shift crude purchases toward other producers during the disruption, its gas imports remained far more vulnerable, since the bulk of LNG cargoes from Qatar travel through the same strait. With shipping now restored and commercial contracts in force, attention shifts to whether current ceasefire terms hold, given how quickly a fresh escalation could reintroduce the same supply risks the March order was designed to manage.