Prices: milk and electricity on the rise;  gas and transport down

Prices: milk and electricity on the rise; gas and transport down

The first day of August was marked by a series of changes to the cost of living in Israel. Prices for electricity and dairy products increased while the price of gasoline and public transport decreased.

Dairy products, whose prices are controlled, rose 4.9% on Monday, in accordance with the agreement reached last week between the Ministry of Finance and milk producers. Following the change, a liter of milk will increase to NIS 6.23, and 28% fat sliced ​​cheese, known as Emek, will now be NIS 44.79 per kilogram.

Electricity prices rose 8.6%, slightly less than the 9.6% originally announced by the Electricity Authority early last month, under a deal that will see the company to develop the use of natural gas in the production of electricity.

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In contrast, the price of gasoline in Israel fell by about NIS 1.50 per liter at midnight, after rising steadily over the past few months.

Israelis will pay an estimated NIS 6.54 – that’s an estimate – per liter of gasoline instead of the NIS 8.08 per liter they had to pay for the whole of July – a record price and which had been unprecedented in the country since 2012.

“We are all aware that the rise in prices is due to the global economic crisis,” Finance Minister Avigdor Liberman tweeted.

“To my great regret, the price of electricity rose overnight to NIS 4.91 per kilowatt hour,” he wrote. “It is important to understand that the price increase is primarily due to the world price of coal, which has increased since the beginning of the year by 180%. »

Finance Minister Avigdor Liberman speaking at a faction meeting in the Knesset, June 27, 2022. (Olivier Fitoussi/Flash90)

Liberman said electricity prices in Israel are low compared to other countries and efforts have been made to keep the price increase as low as possible.

While an average family will pay 35 shekels more per month for electricity due to the change, that same family can expect to pay 150 shekels less at the gas pump, he calculated.

A major reform of public transport also started on Monday, with prices halved for people aged 60 to 75, children aged 5 to 18 and people with disabilities. People over the age of 75 and under the age of five can now travel for free.

Among other changes, trips up to 15 kilometers will cost NIS 5.50 and allow unlimited transfers to other lines for a period of 90 minutes after the start of the trip.

Longer trips, up to 40 kilometers, will cost 12 shekels, and those up to 120 kilometers will be 16 shekels.

Trips longer than 120 kilometers will cost NIS 27, but lines to Eilat, Israel’s southernmost point, will have a separate fare system.

Monthly bus passes that allow travel with all bus companies in the country will be 225 shekels. A special monthly bus pass for travel up to 40 kilometers will be available in outlying towns for 99 shekels. However, this pass is not valid on the Israel Railways or Tram networks.

Monthly subscriptions can be purchased online via the Rav Kav Online Line and Rav Kav Hop-on apps, or at hundreds of stores in 104 cities nationwide.

Other aspects of the Cash Use Reduction Act 2019 have also come into force.

The law limits the use of cash for any transaction with a business over 6,000 shekels, up from the previous threshold of 11,000 shekels. Transactions between individuals are now limited to NIS 15,000, down from NIS 50,000 previously. The purchase of a car is an exception to this rule, since individuals can exchange up to 50,000 shekels between themselves.

Illustrative photo of 100 shekel bills, December 31, 2017. (Nati Shohat/Flash90)

Alongside these various adjustments, a standoff pits the main supermarket chains against Diplomat, the main importer and distributor, which is seeking to raise the price of certain products, including Starkist tuna, Oreos, Pringles and products from Pantene hygiene. Some supermarkets are refusing the hike, Channel 12 reported.

The drop in the price of petrol is the result of the government cutting the excise duty on petrol for the second time this year, and the drop in the price of crude oil, which has fallen globally since early June.

Oil prices peaked at $122.11 a barrel on June 8 – the highest price since March 8 – and have since fallen, hitting around $98 a barrel on Sunday.

A change in the price of black gold which is partially driven by the worry of a global recession which could lower the demand for oil in the near future. Among the other reasons justifying this change, the release of oil reserves, in the United States, and an increase in production in various countries, in particular in the United States and in Libya.

But even with this drop in prices, more than half the price of a liter of gasoline in Israel results from various taxes.

Illustrative image of a car refueling at a gas station in Jerusalem on March 11, 2022. (Jamal Awad/Flash90)

Liberman reduced their tariff by half a shekel per liter in April and the most recent reduction is expected to be the same – meaning that taxes will drop by a total of one shekel per litre.

This latest tax rebate, however, is only expected to last for a month and prices are expected to rise again by half a shekel per liter at the end of August. The reduction of half a shekel that took place in April will end, for its part, in January 2023.

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