The maximum price of government price controlled 95 octane gasoline at self-service pumps in Israel will rise on Wednesday at midnight October 1, 2026, by NIS 0.52 per liter to NIS 8.27 per liter, the Ministry of Energy and Infrastructure has announced. The charge for service at pumps will remain at NIS 0.26 per liter. These prices include VAT. This exceeds the record ever price for gasoline in Israel.
The maximum price of government price controlled 95 octane gasoline at self-service pumps in Eilat, where there is no VAT, will rise by NIS 0.44 per liter to NIS 7.01 per liter on October 1. The charge for service at pumps will remain at NIS 0.22 per liter.
The Ministry of Energy and Infrastructure wrote, "The expected price includes the adjustment of the excise tax, which was cut NIS 0.50 per liter last month, in accordance with the temporary provision of the excise tax order effective from September 7, 2026, through the end of October 2026." In other words, without the excise tax reduction, the price of fuel would have risen even further.
The Ministry of Energy also noted, The price hike stems from an approximately 13% rise in gasoline prices in international markets, driven by climbing global oil prices and persistent concerns regarding disruptions to oil supplies and the stability of the global energy market. Compounding this was a roughly 3% strengthening of the dollar (against the shekel), which also impacted fuel prices in Israel."
"The ineffectiveness of the excise tax cut policy"
"The price increase stems from rising oil prices in global markets, driven by the deepening of the Gulf crisis to include the Houthi front," explains Chen Herzog, Chief Economist at BDO. "This is happening alongside a persistent global shortage in refining capacity caused by the blockade of the Strait of Hormuz, the war in Ukraine, and damage to refineries in Russia."
Last month, the price of 95 octane gasoline at self-service pumps rose by NIS 0.16 to 8.25 per liter, matching the all-time high set in September 2012. However, Minister of Finance Bezalel Smotrich issued a temporary order to reduce the excise tax, bringing the fuel price to NIS 7.75 per liter.
"The current price hike demonstrates the ineffectiveness of the policy to cut excise taxes," says Herzog. "The state is forced to subsidize the tax reduction from other sources, at the public's expense, and cannot alter global trends.
"While excise tax is a major component in the price of gasoline, the current rise stems primarily from the price of oil. In recent days, the price of a barrel of oil even crossed the $100 mark. In fact, today's price is only about $15 lower than the highs seen at the peak of the conflict involving Iran. These prices reflect a triple market failure in the global oil market: the Strait of Hormuz, the Houthis, and Ukrainian strikes on Russia."
Published by Globes, Israel business news - en.globes.co.il - on September 29, 2026.
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