Israel cuts fuel tax 50 agorot through November

Finance Minister Bezalel Smotrich signed an order Wednesday reducing the excise tax on petrol by 50 agorot per litre for 26 days through the end of the month, the Finance Ministry announced. The order is intended to offset a price rise that would otherwise have taken effect, the ministry said.

Under the order, effective midnight Wednesday night, the price of a litre of 95-octane petrol at self-service will stand at 7.85 shekels. The reduction comes after prolonged discussions within the Finance Ministry over whether to continue subsidising fuel prices.

In early October, Smotrich doubled the fuel-tax discount from half a shekel to a full shekel per litre under an excise-reduction order. That subsidy, estimated to cost the treasury some 300 million shekels a month, was set to expire at the end of October. The new order signed by the minister grants a smaller reduction, 50 agorot only, and for a shorter period of 26 days.

According to earlier reports, a dispute erupted within the Finance Ministry over extending the subsidy. The professional ranks opposed continuing the subsidy, whose cost was estimated at hundreds of millions of shekels each month. At the same time, security tensions in the Strait of Hormuz, stemming from the war between the United States and Iran, have pushed global oil prices to around $110 per barrel.

Petrol station (Photo: Jamal Awad/Flash90)

The Energy and Infrastructure Ministry announced: "Following an update to the excise amount on petrol, at midnight between Wednesday and Thursday (4.11.2026–5.11.2026), the prices of regulated fuel products sold to consumers at petrol stations will be updated. The maximum price per litre of 95-octane unleaded petrol for consumers at self-service stations (including VAT) will not exceed 7.85 shekels per litre, an increase of 50 agorot from the previous update."

The ministry added: "The surcharge for full service will stand at 26 agorot per litre (including VAT), unchanged from the previous update. The maximum price per litre of 95-octane unleaded petrol for consumers at self-service stations in Eilat (excluding VAT) will not exceed 6.65 shekels per litre, an increase of 42 agorot from the previous update. The surcharge for full service will stand at 22 agorot (excluding VAT), unchanged from the previous update."