What is the alternative fuel that causes trouble in Cars 2?

The alternative fuel that causes trouble in Cars 2 is Allinol.

Sir Miles Axlerod introduces Allinol during the World Grand Prix as a supposedly clean, environmentally friendly fuel. The international race is designed partly to promote it, with racers from around the world using the new product in Tokyo, Porto Corsa, and London.

The crisis begins when a weapon disguised as a television camera emits electromagnetic pulses. Allinol reacts to those pulses and ignites, making the fuel appear dangerously defective. The Lemons use the incidents to turn public opinion against alternative fuels and protect the villains' oil-based business interests.

A major twist is that Allinol is not simply an unsafe experimental fuel. Axlerod engineered the conspiracy, while Fillmore's organic biofuel proves unaffected by the pulse weapon. Sarge secretly replaces Lightning McQueen's Allinol before the final race, which is why McQueen survives. Common mix-ups include Rust-eze, Dinoco, and Octane Gain: those are brands or sponsors, not the alternative fuel at the center of the plot.