- Miftah warns against making “hasty decisions without proper assessment”.
- Says sugar mills could quickly enter the sector if ethanol proves viable.
- Expresses doubts about immediate rollout due to infrastructure issues.
ISLAMABAD: Former Finance Minister and Awaam Pakistan Party (APP) leader Miftah Ismail has called for a careful, well-researched approach to Pakistan’s ethanol blending policy to reduce oil prices.
“It is always good to take a look and evaluate things, but one has to be careful in changing policy,” he said while speaking to The news.
Miftah cautioned against making “hasty” decisions without proper assessment, adding that it is reasonable to explore the possibility of ethanol blending, but any policy adjustment should be carefully considered.
He noted that if ethanol production proves to be commercially viable, sugar mills will naturally move into the sector. “They will get one more market and hope that the price of ethanol will increase,” he added.
Discussing the possible impact on oil marketing companies, Miftah said the results would largely depend on government policy. If companies are mandated to blend a fixed percentage, such as 10% ethanol, and given a fixed price, many can obtain ethanol at lower prices and keep the margin as profit.
The former finance minister suggested that the oil ministry in collaboration with Pakistan State Oil and representatives of the sugar industry could quickly conduct a basic assessment. “This can be studied within a few days after which options can be worked out,” he said.
However, he expressed reservations about immediate implementation, citing practical challenges such as blending mechanisms, required infrastructure and timelines. “I don’t think it will be feasible and implementable right away,” he noted.
Miftah linked the economic viability of ethanol blending to global oil prices, saying it becomes attractive when Brent crude trades above $100 a barrel. barrel.
“At normal oil prices of $60 to $80, ethanol is generally not economically viable,” he explained.
Drawing comparisons, he pointed out that Brazil has a huge sugar cane and ethanol industry, where sugar is often a by-product, while the US supports ethanol production through large-scale corn cultivation and political mandates.
While he acknowledged that current gasoline prices in Pakistan could make ethanol blending appear economically feasible, he warned that operational and logistical constraints may limit its practicality in the short term.
