'Gas prices in Israel are 3rd highest in the world'

Price could rise from current NIS 7.70 per liter to as much as NIS 8.25 due to increase in oil prices, upcoming VAT hike.

By GLOBES / KOBY YESHAYAHOU
Person filling car gas tank 370 (photo credit: Thinkstock/Imagebank)
Person filling car gas tank 370
(photo credit: Thinkstock/Imagebank)
Israel has the third highest price in the world for gasoline, according to a Bloomberg survey published last week, and the situation is unlikely to improve anytime soon.
Globes reported on Thursday, that the price of self-service 95 octane gasoline, which is government-controlled, could rise from the current NIS 7.70 per liter to as much as NIS 8.25 per liter on September 1, due to the rise in the price oil and the VAT hike, which will come into effect on the same day.
The "Bloomberg Gas Price Ranking" of 60 countries has two variables: the average price of gasoline at the pump in US gallons (3.75 liters), and the pain at the pump, which is measured by the percentage of average daily income needed to buy a gallon of fuel.
Norway tops the "Bloomberg Ranking", at $10.19 per gallon in the second quarter, 4.4 percent more than in the preceding quarter. However, Norway ranks 52nd in pain at the pump, because of the country's high average daily income of $272. It is followed by Turkey, at $9.41 per gallon, but 7th in the pain at the pump ranking, because the average daily income is $30 per day.
The price per gallon of premium gasoline in third-placed Israel is $9.28, and the pain at the pump rank is 31st: "The average daily income in Israel is $87, and it takes 11% of an average day's wages to buy a gallon of gas," says Bloomberg, which did not include Israel in its previous survey.
Bloomberg reported: "Surrounded by oil producers in the Middle East, Israel itself drills very little. Gasoline prices are controlled by the government, and taxes typically make up about half the cost of a gallon.
"Gas prices have led to widespread discontent and political demonstrations over the cost of living. Prime Minister Binyamin Netanyahu has intervened to prevent prices from rising with the global price of oil, most recently when he lowered price 2.9% on June 1, according to the Energy and Water Resources Ministry."
Bloomberg added, "While the country taxes gas, it simultaneously subsidizes oil. Israel paid about $565 million in subsidies in 2010, a relatively small contribution to the world's $409 billion in global fossil-fuel subsidies."
Hong Kong and the Netherlands are in fourth and fifth place in the "Bloomberg Gas Price Ranking." Venezuela is at the bottom of the rankings, with consumers paying $0.09 per gallon of gasoline. Above it are Saudi Arabia, Kuwait, and Egypt.