2,573 outlets barred from selling petrol amid E20 quality scare

The Ministry of Petroleum and Natural Gas has responded to concerns about ethanol-blended petrol by stopping sales at the pump. As of August 25, petrol sales have been suspended at 2,573 retail outlets that did not meet standards, according to senior ministry sources. Of these, Indian Oil Corporation is responsible for 1,257 pumps, Hindustan Petroleum for 915, and Bharat Petroleum for 401.

If these numbers are officially confirmed, this would be the biggest freeze of public-sector petrol sales in years. This contrasts with the ministry’s earlier statement this month, which said only two cases of chloride were found after testing over 2,000 samples. Later, oil companies reported four isolated cases across a network of more than 100,000 stations.

The trigger was not a laboratory press release. The issue did not start with a lab report, but with a letter. On July 28, the Society of Indian Automobile Manufacturers wrote to the petroleum secretary, warning that their members were seeing a “huge increase” in failures of fuel injectors, fuel pumps, and EGR valves. According to SIAM, investigations pointed to corrosion and wear caused by high chloride levels in E20 fuel. Chloride levels in samples from vehicle tanks reached up to 500 mg/kg, while samples from retail outlets were as high as 350 mg/kg.

The letter also raised concerns about excess moisture and the risk of ethanol and petrol separating after water entered the fuel, potentially leaving vehicles stranded. SIAM specifically linked these problems to the rollout of E20. It drew it, saying some figures “needed further verification” and that media reports had quoted it selectively. The retraction did not bury the story.

An investigation into internal testing data and emails among executives at Maruti Suzuki, Tata Motors and Mahindra firms that together sell about two-thirds of India’s cars, showed that private sampling across 21 states had already recorded chloride far above the Government’s 3 ppm benchmark in many locations, including readings running into hundreds of ppm in Rajasthan, Delhi and Maharashtra.

Some samples also showed moisture levels well above the 3,000 ppm limit. SIAM told Reuters that the data were internal and collected by only a few automakers. Now, both the public reversal and the private findings are being considered together.

The Government has responded with new procedures, more checks, and greater transparency. To restore confidence and track water and contaminants, the ministry now requires that underground tanks be tested for water entry 8 to 12 times a day.

That regime, sources said, is underway at 88,995 dealerships. A sweeping audit prioritising older outlets has covered 84,687 stations. Field teams are checking the integrity of the tanks during rainfall. Automation systems with monitoring probes are active at 85,649 outlets; malfunctioning units are being repaired. Oil-marketing companies have conducted 7,296 sulphur tests and 1,079 chloride tests on tankers carrying ethanol, as well as 151 chloride tests on their own storage tanks.

These numbers are generally in line with what the ministry and oil companies have already reported: daily tank checks at about 87,000 to 90,000 outlets, more frequent sampling from the refinery to the pump, and a rule that any contamination results in immediate suspension. Suspension.

Oil-marketing companies say that petrol from refineries contains 1 ppm or less of chloride, and ethanol from many distilleries tested at levels below 3 ppm. They also report that most retail samples are in the 0-3 ppm range, not in the hundreds, as mentioned in the withdrawn SIAM letter. They add that inspections of underground tanks have not found any water entry so far.

The science behind the risk is clear. Ethanol attracts water. Water that used to settle harmlessly at the bottom of a tank can now mix with ethanol in the fuel. Old seals, flooding during the monsoon, coastal humidity, and chloride contamination in tanks or tankers are all weak points in the supply chain, as SIAM pointed out before withdrawing its letter. Dealers in areas with heavy rain have long warned that E20 is less forgiving of leaks than regular petrol.

What the halt of 2,573 pumps actually measures remains a political question. If those outlets were stopped for chloride, water, broken probes, failed tank integrity or paperwork, the public is entitled to a breakdown. If most are temporary closures pending repairs to automation or monsoon-proofing, the headline number overstates the contamination crisis.