Gas prices to rise again next week

The upheaval in the Arab world will result in another hike in gas prices in Israel.

February 23, 2011 00:49
1 minute read.
Illustrative photo

311_offshore oil well. (photo credit: Associated Press)

The upheaval in Libya and the Arab world in general is pushing up the global price of oil, and will result in another hike in the price of gasoline in Israel.

Currently calculations indicate that the price of 95 octane gasoline will rise by at least NIS 0.17 per liter at midnight on February 28 – next Monday.

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The calculation is based on the current price of a barrel of oil. Assuming that the rise in the price of oil continues over the next few days, the price of fuel next month could be even higher.

Today is the first day of the trading days at the end of the month for calculating the government-controlled price of gasoline in Israel.

The price of gasoline is based on the average quotes of CIF La Vera trade prices for fuels in the Mediterranean basin, which are then converted from dollars into shekels. The shekel’s weakness against the dollar in the past few days will also contribute to higher prices at the pump.

The formula for calculating the price of gasoline is as follows: 32 percent is the La Vera trade price, 43% is the excise, 14% is VAT, and 10% in the fuel companies’ marketing margin.

The NIS 0.12 per liter price hike for gasoline on February 1 was also mainly due to the rise in the price of oil and the shekel-dollar exchange rate. In addition, on January 1, the government raised the excise on gasoline. Taken together, the price of 95 self-service gasoline rose over three months from NIS 6.71 per liter to NIS 7.26. However, the price fell back earlier this month to NIS 7.04 per liter when the government canceled the excise hike following public discontent.

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