Israeli Fuel Prices Drop Significantly to 7.48 Shekels per Liter in July

Fuel prices in Israel will decrease by 32 agorot per liter starting midnight between June 30 and July 1, marking the second consecutive monthly decline following a 27 agorot drop in June. The maximum retail price for 95-octane unleaded gasoline at self-service stations will be capped at 7.48 shekels per liter, including VAT. Full-service fuel will cost an additional 25 agorot per liter, unchanged from the previous update. In Eilat, the price excluding VAT will not exceed 6.34 shekels per liter, with a 21 agorot surcharge for full service.

Batsheva Abuhatzira, head of the Fuel and Gas Administration at the Ministry of Energy and Infrastructure, described this as the most significant monthly price drop in the past three months. Since April, gasoline prices have fallen by a total of 59 agorot per liter. The main cause of this month's reduction is the weakening of international gasoline prices, driven by a decline in energy market risk premiums and easing concerns over potential disruptions in global oil supply. Consequently, international gasoline prices have fallen by about 16%. However, a 6% strengthening of the US dollar against the shekel has somewhat offset the price decrease for consumers.

The Ministry of Energy and Infrastructure reminded the public to compare prices among gas stations to find the best deals. The all-time peak price for 95-octane gasoline was 8.25 shekels per liter in September 2012. At that time, Prime Minister Benjamin Netanyahu first proposed reducing fuel taxes to lower prices amid public discontent following the 2011 social justice protests. Although the fuel tax discount was later canceled, it was reinstated by Finance Minister Avigdor Lieberman in summer 2022 when prices again surpassed 8 shekels per liter, prompting government intervention. The fuel tax subsidy was ultimately removed in early 2024 by current Finance Minister Bezalel Smotrich, partly due to the growing budget deficit caused by the ongoing war.