Israel Gas Prices Hit Record High Amid Global Market Turmoil
Translated & summarized from Channel 9 by baba
Gasoline prices in Israel have reached a record high of 8.27 shekels per liter due to global market increases and a stronger dollar. This surge negates a recent excise tax reduction, and economists warn of further inflation and consumer price hikes.
The story in 5 lines · by baba
- Israel gas prices hit record 8.27 shekels per liter.
- Global market factors and dollar strength drive the increase.
- Recent excise tax cut is effectively nullified.
- Economists predict higher consumer prices and inflation.
- Previous record was set just one month ago.
Gasoline prices in Israel have reached an all-time high, with a liter of 95-octane fuel set to cost 8.27 shekels starting Thursday, October 1. This represents a 52 agorot increase, surpassing the previous record of 8.25 shekels set in early September. The surge is significantly higher than the initially predicted 35-40 agorot rise, pushing the price back above the 8-shekel psychological threshold.
The Ministry of Energy attributed the sharp increase to global market conditions, citing a roughly 13% rise in international gasoline prices driven by higher oil costs and concerns over supply disruptions. The strengthening U.S. dollar, up approximately 3%, has also directly impacted fuel costs in Israel.
Energy market representatives pointed to a "triple market failure" as the cause of the global trend, including tensions surrounding Iran and the Persian Gulf, threats to maritime routes from the Houthis, and damage to oil refineries in Russia.
This price hike effectively negates the Finance Ministry's decision to temporarily reduce fuel excise tax by 50 agorot per liter, a measure implemented in September at a cost of approximately 300 million shekels to the state. Without this tax reduction, the price would have approached 8.80 shekels per liter. The current 8.27 shekel price already incorporates the excise reduction, which is set to expire at the end of October.
Economists warn that the increased fuel costs will raise production and logistics expenses, potentially leading to higher prices for consumers and impacting the October consumer price index. Furthermore, higher inflation may prevent the Bank of Israel from further lowering interest rates in the near future.
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