Petrol rises to 8.27 shekels a liter as a further excise tax cut receives legal clearance

The maximum price of self-service 95-octane petrol rose on 1 October to 8.27 shekels a liter, including VAT, an increase of 52 agorot. The same day opened the way for another excise tax reduction: according to Globes, the attorney general said there was no legal obstacle to advancing the measure requested by the finance minister. But permission to advance a price cut and the price currently charged at the pump are two different things.

As of the evening of 1 October, the additional reduction had not taken effect. The reported price of 7.77 shekels a liter depends on completing the process and signing the order. For drivers planning travel expenses, that is the difference between a price in force and a change still expected.

The new price at stations and in Eilat

The Ministry of Energy announcement, as reported by ynet, set the national maximum price of self-service unleaded 95-octane petrol at 8.27 shekels a liter. The full-service supplement remains 26 agorot a liter. Where that supplement is charged, the arithmetic total is 8.53 shekels a liter.

In Eilat, where the reported price excludes VAT, the self-service cap was set at 7.01 shekels a liter, an increase of 44 agorot. The full-service supplement there remains 22 agorot. Distinguishing Eilat from the rest of the country, and self-service from full service, is necessary to compare prices for the same kind of refueling.

This is a maximum price, so stations can offer a lower one. The regulated petrol update is not a price list for every product sold at a petrol station. It does not automatically establish the price of 98-octane petrol, diesel or another service, and price comparisons alone should not prompt switching fuel types.

What was approved, and what still has to happen?

According to Globes' report on advancing the excise tax reduction, the legal advisory position allows Finance Minister Bezalel Smotrich to advance another reduction of 50 agorot a liter. At the reported stage, the draft order was due to be published for public comments, with implementation planned for the night between Sunday and Monday, subject to signature.

The planned self-service price after the reduction is 7.77 shekels a liter. That is half a shekel below the cap introduced at the start of October, but two agorot above the 7.75-shekel price in force after September's excise tax cut.

Two apparently contradictory headlines can therefore describe different stages: petrol has already become more expensive while a reduction is being advanced. For an actual fill-up, what matters is the effective date of the official update, not the date a promise or legal clearance was announced.

How much do 52 agorot add to the expense?

The effect depends on the number of liters purchased. At the self-service cap, 40 liters cost 330.80 shekels at the new price, compared with 310 shekels previously. The difference is 20.80 shekels. For 50 liters, it reaches 26 shekels.

How you compare also matters: if you compare one full-service fill-up with another at self-service, part of the difference reflects the service type. To isolate the monthly increase, compare the same number of liters with the same service and check whether either transaction included a discount.

Here too, distinguish an example from an average: these quantities were chosen for illustration, not as figures for typical refueling in Israel. Someone buying 100 liters over a month will pay an extra 52 shekels if the entire quantity is purchased at the new rather than previous price. If the price changes during the month, the actual expense will depend on refueling dates.

If the planned half-shekel reduction takes effect, 40 liters at 7.77 shekels will cost 310.80 shekels. The saving compared with 8.27 shekels would be 20 shekels for the same quantity. This calculation excludes commercial discounts, service supplements and personal fuel arrangements, so it does not replace the amount displayed at the station and on the receipt.

Why did the price rise despite the previous reduction?

According to reports by ynet and the Economy Channel, the monthly increase came alongside a rise of approximately 13% in international petrol prices and an approximately 3% strengthening of the dollar. The Ministry of Energy said the new price already includes the previous excise reduction of 50 agorot a liter and does not cancel it.

In other words, a tax reduction can moderate the price without preventing every increase. If other calculation components become more expensive, the final result may rise even while the tax relief remains in place. Simply adding the percentage change in international prices to the percentage change in the dollar does not give the pump-price increase.

Autocom explained that the price calculation uses petrol prices in the Mediterranean basin during a defined trading-day window, the exchange rate, a basket of marketing expenses, excise tax and VAT. Crude oil prices form only part of the economic background; they alone do not determine the price of a liter at the pump.

This difference also explains why a daily shift in global markets does not necessarily appear immediately on Israeli price signs. Updates follow a mechanism and an effective date. Alongside the monthly update, a tax change may produce an additional adjustment, as currently proposed.

Temporary relief leaves a question for the end of October

The previous excise reduction took effect on 7 September and, according to the price announcement quoted in the media, lasts until the end of October. Part of the current price therefore rests on a temporary arrangement. This still does not establish a certain November price, because market conditions and the exchange rate may also change by then.

A business operating several vehicles can separate its expected fuel volume from the price it will pay in its planning. For example, at the same consumption of 500 liters, a half-shekel difference changes expenditure by 250 shekels. That is a simple sensitivity calculation, not a forecast for next month's prices or a recommendation to buy fuel at a particular time.

The next details to watch are publication of the final order, its effective date and the Ministry of Energy's price update. Until those steps are completed, the cap introduced at the beginning of October remains the reference point. Afterward, check the date on the new announcement rather than relying on an old headline about an increase or decrease.