Government authorizes oil companies to increase use of biofuel to avoid passing on to consumers; rule follows trend adopted by Brazil
The Argentine government authorized the expansion of the ethanol blend in gasoline as a strategy to mitigate the impact of the international appreciation of oil on the domestic market. The measure allows oil companies to raise the percentage of biofuel from the current 12% to up to 15%, on an optional basis.
The decision keeps the mandatory minimum percentage unchanged, but grants autonomy to companies to adjust the composition of the fuel according to market conditions. In practice, the flexibility reduces dependence on petroleum products and works as a buffer against price fluctuations in refineries, at a time of global uncertainty.
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To make the technical change viable, the Argentine Energy Secretariat also raised the limit of oxygen allowed in gasoline to 5.6% – an index directly linked to the presence of ethanol. The measure does not cover diesel, which remains with the mandatory blend of up to 20% biodiesel, according to the legislation in force in the neighboring country.
According to the official statement, the move seeks to shield the Argentine economy from the effects of geopolitical tensions in the Middle East, which have put pressure on the price of a barrel of Brent oil. In addition to the economic factor, the government points out that the increase in octane provided by ethanol improves combustion efficiency and reduces carbon monoxide emissions, in line with environmental goals.
The Argentine initiative comes as Brazil consolidates even higher levels of blending. Since 2025, Brazilian gasoline has contained 30% ethanol, and the Ministry of Mines and Energy is coordinating tests to raise the rate to 35%. The Brazilian program, which foresees investments of R$ 30 million, evaluates the long-term impacts on the performance of engines and the energy efficiency of the national fleet, under strong criticism from entities in the sector.
