Israel raises fuel prices to nearly four-year-high as oil costs soar amid Iran war

Israel has moved to hike up fuel costs starting Wednesday, setting the highest prices in nearly four years, as the impact of the U.S.-Israeli war with Iran sees global oil prices soar.

The country's Energy Ministry announced Monday that starting from April 1, the price of unleaded 95-octane gasoline would rise to 8.05 shekels (over 2.5 U.S. dollars) per liter, up from 7.02 shekels, representing a 14.7 percent increase.

The ministry said the hike was necessitated by a nearly 50 percent rise in fuel prices across Mediterranean countries, amid higher global oil costs linked to the ongoing war with Iran and concerns over the disruption to shipping through the Strait of Hormuz -- a vital passageway that carries about one-quarter of global seaborne oil trade.

In addition, the ministry said the exchange rate for the shekel also rose slightly by about 2 percent, which has pushed up Israel's import costs and further contributed to the increase in fuel prices.

Gasoline prices at Israeli gas stations are set by the Energy Ministry at the end of each month, based on the average fuel prices in the Mediterranean region and the exchange rate of the local currency.

The new price is the highest for more than three and a half years, with ministry figures showing the last peak was 8.08 shekels per liter in July 2022.

Israeli public broadcaster Kan TV News reported that the government is considering intervening to lower prices by cutting the excise tax. The finance ministry is opposed to the move, however, citing increased spending tied to the war and the need to preserve fuel tax revenues.

The conflict erupted on Feb. 28 when Israel and the United States launched joint attacks on the Iranian capital Tehran and several other cities, killing Iran's then Supreme Leader Ali Khamenei, along with senior military commanders and civilians. Iran has responded by launching waves of missile and drone strikes targeting Israel and U.S. bases and assets in the Middle East.

Israel raises fuel prices to nearly four-year-high as oil costs soar amid Iran war

Israel raises fuel prices to nearly four-year-high as oil costs soar amid Iran war

Israel raises fuel prices to nearly four-year-high as oil costs soar amid Iran war

U.S. President Donald Trump said he is strongly considering pulling the United States out of the North Atlantic Treaty Organization (NATO) after the alliance failed to join the attacks on Iran, The Telegraph reported on Wednesday.

When asked if he would reconsider America's membership in the alliance after the conflict, he said the question is "beyond reconsideration," adding, "I was never swayed by NATO. I always knew they were a paper tiger."

Trump also expressed dissatisfaction with NATO for "not being there," saying it was "actually hard to believe."

Speaking at a press conference on Tuesday, U.S. Defense Secretary Pete Hegseth said Trump would make a decision on the future of NATO given the fact that some U.S. allies refuse to provide support, after the end of U.S. military operations against Iran.

Following Trump's criticism, British Prime Minister Keir Starmer said he is not changing his position on the war.

Multiple European countries have kept their distance from the conflict with Iran. Starmer on Monday said his country will not get dragged into the conflict "whatever the pressure and whoever it's coming from," while Spain on Monday closed its airspace to all flights related to the U.S. and Israeli military strikes on Iran.

Trump calls NATO 'paper tiger,' considers withdrawal