Israeli Gasoline Could Reach 9 Shekels Per Liter Next Week

Drivers in Israel face a likely spike at the pump within the next few days. The cost of 95-octane gasoline, currently NIS 7.77 per liter, may rise above NIS 9 if a temporary tax reduction expires on schedule.

The price increase stems from two factors converging at the end of next week. Finance Minister Bezalel Smotrich introduced a fuel tax cut last month to stabilize prices ahead of the upcoming election. That relief is set to lapse on November 3, removing a financial buffer from pump prices.

Global market conditions are adding pressure. Expectations of a third round of conflict involving Israel, Iran, and the United States have lifted oil prices by approximately 10% since late September. The Energy Ministry's Fuel Administration set the current October price during a period of lower oil costs.

The Finance Ministry's Budget Department estimates the recent tax reductions will cost the state roughly NIS 467 million over the past two months. Under standard conditions, taxes account for more than 60% of the gasoline price and generate about NIS 20 billion in annual revenue for the state.

Smotrich faces a decision after the election on whether to extend the relief. If the current government is expected to lose power, he may allow prices to jump, leaving the next administration to manage the economic impact. The initial price hike is expected as early as Saturday night.

Even if the tax cut remains in place, gasoline is projected to rise by around 30 agorot per liter, pushing the cost just over NIS 8. If the reduction ends as planned, the price could climb above NIS 9. The final figure will be determined toward the end of the week based on Mediterranean basin oil prices.