Given the recent drastic fall in oil prices, the question arises once again, at which oil price ethanol is still competitive (without subsidies).

The answer depends on various factors but, considering the state of the art technology for sugar cane plantation and ethanol production, the break even point is lower than
the oil prices can be expected to fall.

For a fair evaluation, the following premises have to be considered:
- ethanol price has to be compared on a FOB basis to gasoline at the oil refinery,
- it has to include all costs but also consider the sale of energy from bagasse as well as carbon credits, both of which should be deducted from the costs, in order to obtain a realistic break even point i.e. neither profit nor loss.

The graph which follows illustrates these facts: