Gas prices to drop in Israel, but there's a catch

The Israeli government plans to further reduce the fuel excise tax by 50 agorot per liter, which combined with an existing discount will bring a total reduction of 1 shekel. The discount is set for one month, lasting until a few days after the elections. The Finance Ministry opposed the move, citing budgetary risks.

The Israeli government plans to temporarily lower gas prices by adding a new discount to the existing one. This involves an additional reduction of the excise tax by 50 agorot per liter, which together with the previous discount will result in a 1-shekel reduction. However, gas will not immediately drop by the full amount, as the first 50 agorot are already factored into the current price. The discount is set for one month and will last until a few days after the elections. There are no legal obstacles—on October 1, government legal adviser Gali Baharav-Miara confirmed this. Finance Minister Bezalel Smotrich will sign the decree after a public hearing. The Finance Ministry opposed the move, citing significant costs to the budget and a lack of funding sources. Since October 1, 2026, the price of a liter of gas has risen by 52 agorot, reaching a record 8.27 shekels. Without the existing discount, the price would have been 8.77 shekels. After the discount ends, the price will depend on global oil prices.

Gas prices to drop in Israel, but there's a catch