'Diesel fuel in Israel more expensive than in Europe'

Knesset Research, Information Center survey shows since price controls on diesel were lifted in 2005, Israel has most expensive diesel in Europe.

July 12, 2011 23:46
1 minute read.
Gas station

Gas station 521. (photo credit: Marc Israel Sellem)

A Knesset Research and Information Center survey has found that since price controls on diesel were lifted in January 2005, Israel has the most expensive diesel in Europe: 35 percent above the average in terms of purchasing power.

The study examined fuel prices in the past decade. The price of diesel for heating rose 386.5%, and the price of diesel for vehicles rose 242.6%. In contrast, the price of 95-octane gasoline, which is government controlled, rose 92.4%. Between January 2005, when the Knesset removed price controls on diesel as part of a fuel excise reform, and January 2011, the excise on diesel rose 306.6% in nominal terms and 245.1% in real terms.

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The average price of diesel in the European countries examined on June 27 was 1.11 euros per liter, compared with 1.56 euros per liter in Israel (in purchasing-power terms). Diesel cost 1.48 euros per liter in the UK, 0.99 euro per liter in France and 0.84 euro per liter in Denmark, the lowest price in the comparative study.

Former Knesset Economics Committee chairman MK Ofir Akunis (Likud) commissioned the study. Last month, he submitted a private member’s bill to reimpose price controls on diesel. On Tuesday, he said the study’s findings support his bill, and he called on National Infrastructures Minister Uzi Landau to support it and to immediately reimpose price controls.

“The worrying figures raised by the study depict a problematic picture of outof- control prices,” Akunis said. “The lifting of price controls on diesel has failed due to market failure, because no natural and real competition was created. The losers are the consumers. This must stop.”

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