Israel Gas Prices Poised to Exceed 8 Shekels Amid Global Tensions

Gasoline prices in Israel are expected to rise significantly next week, potentially exceeding 8 shekels per liter. Current calculations indicate an increase of over 40 agorot per liter, with the final price to be announced in five days, according to N12. The primary driver for this surge is the continued rise in global oil prices, influenced by tensions surrounding Iran and the Houthi control over the Bab-el-Mandeb Strait. Additional pressure stems from the ongoing tensions between Russia and Europe.

If the current forecast holds, this price hike will largely negate a 50 agorot per liter subsidy implemented earlier this month. This subsidy was intended to cushion the impact of rising fuel costs for consumers. The government's decision to provide the subsidy was projected to cost the economy approximately 300 million shekels.

However, a final decision on the subsidy's extent has not yet been made. Finance Minister Bezalel Smotrich has the authority to increase the fuel subsidy, which could mitigate the expected price increase for consumers. The upcoming election, approximately one month away, adds a political dimension, as the government must consider potential voter dissatisfaction.