The Petah Tikva District Court rejected an appeal by Arbel Aloni, who was convicted of murding cab driver Derek Roth together with Moshe Ben-Ivgi in 1994, to shorten his prison sentence on Monday.
Aloni, 31, asked the court to release him after serving two-thirds of his 16- year sentence, handed down in 1998.
"An early release... could harm the importance of... the sanctity of life in our social and legal culture, and harm public faith in law enforcement system," Judge Avraham Tal wrote in his ruling.
In May, police in Argentina captured Ben-Ivgi, who escaped Israel in 2004 while on vacation from prison. Ben-Ivgi is being held as Argenina considers an extradition request to send Ben-Ivgi back to Israel.
Since fleeing to Argenina, Ben-Ivgi has married and fathered a child.