developing· Economy· Updated 13:20

Israel May See Sharp Fuel Price Hike After November 1st

Gasoline prices in Israel are projected to reach an unprecedented high of nearly 9 shekels per liter by Saturday, November 1, following the Knesset elections on Tuesday, October 27. This potential surge from the current price of 7.77 shekels per liter for 95-octane gasoline depends on whether Finance Minister Bezalel Smotrich decides to extend a temporary fuel tax reduction.

6 newsrooms · 3 languages · since 07:54

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Israel May See Sharp Fuel Price Hike After November 1st — Illustration by baba

What happened

01Israeli gasoline prices could reach a record high of nearly 9 shekels per liter by Saturday, November 1.
02The potential price hike depends on whether Finance Minister Bezalel Smotrich extends a 1 shekel fuel tax reduction expiring October 31.
03If the tax concession is not renewed, the price of 95-octane gasoline will automatically rise from 7.77 to 8.77 shekels per liter.
04Professional officials in the Ministry of Finance oppose extending the tax break, which has already cost the state nearly 500 million shekels.
05An extension of the fuel tax reduction through November is estimated to cost the state budget an additional 300 million shekels.
06Global oil prices have risen to $110 per barrel due to security tensions in the Strait of Hormuz.
07A stronger US dollar, trading at 3.11 shekels, is expected to add an additional 10 to 20 agorot per liter to fuel costs.
08Economists forecast that the fuel price surge could boost Israeli inflation by 0.5% in November.

The current 1 shekel per liter tax concession, which Smotrich doubled from 50 agorot in early October, is set to expire on October 31. If the tax break is not renewed, the price will automatically rise by 1 shekel to 8.77 shekels. Professional officials within the Ministry of Finance oppose extending the benefit, which has already cost the state budget nearly 500 million shekels and would cost an additional 300 million shekels for November.

Global oil prices have climbed to approximately $110 per barrel due to security tensions in the Strait of Hormuz, while the US dollar has strengthened against the shekel to an official exchange rate of 3.11 shekels. These factors are expected to add another 10 to 20 agorot per liter. Economists warn that the resulting fuel price hike could increase Israeli inflation by 0.5% in November, impacting transportation and consumer goods.

Summarized by baba from the reports of 6 newsrooms. Updated 13:52

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