Gasoline prices in Israel are set to fall sharply for the second successive month. Estimates are that the maximum price of government price controlled 95 octane gasoline per liter at self-service pumps in Israel will fall by between NIS 0.20-0.40, on Wednesday night at midnight, September 1 to NIS 6.18-6.38. On August 1, gasoline prices fell by NIS 1.50 per liter to NIS 6.58.
The price of a barrel of oil on world markets has been volatile and after many ups and downs is currently priced at $101 per barrel, similar to the end of July. However, the Ministry of National Infrastructures, Energy and Water Resources calculates the maximum price in Israel according to the average price of oil over the last week of the month, which was slightly lower than the last week of July. Another factor is that the shekel has strengthened 3.9% against the dollar over the past month.
However, what remains unclear about the price of gasoline is the excise tax. Minister of Finance only obtained approval for the NIS 1 per liter cut in excise for August. Liberman is currently working around the clock to overcome legal issues and extend the excise cut until November 15, two weeks after the elections, which was part of his original plan.
The excise cut costs the state coffers about NIS 350 million per month. If the Attorney General rules that extending the excise cut represents election economics and does not permit extending the cut, then gasoline could become more expensive on September 1 by NIS 0.60-0.80 per liter. But estimates are that this is very unlikely to happen.
If all goes to plan, the Ministry of National Infrastructures, Energy and Water Resources will tomorrow publish the maximum price of gasoline in September and the Ministry of Finance will announce that the excise cut has been extended.
Published by Globes, Israel business news - en.globes.co.il - on August 29, 2022.
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