Economy & Aid

Hormuz war premium reaches Palestinian fuel pumps and generators

Times of Palestine2h ago

Published Thursday, September 10, 2026 · 13:30 Jerusalem time

Economy & Aid

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Original Reporting

By the Times of Palestine Newsdesk · 2 min read

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The war between the United States and Iran has driven global oil past $100 a barrel this week, and the increase reaches Palestinian households on some of the least forgiving terms of any market in the region.

Palestinian consumers do not buy fuel on the open market.

Under the Paris Protocol that has governed the Palestinian Authority's economic relationship with Israel since 1994, nearly all fuel sold in the West Bank and Gaza is imported through Israeli suppliers at prices Israeli companies set, and the Authority's own petroleum commission publishes the resulting retail ceiling each month.

When crude rises with the Hormuz war, the increase reaches Ramallah's pumps through an Israeli price-setting layer the Authority does not control and cannot negotiate around.

CSIS panelists said on 24 August that crude was trading near $90 a barrel at the six-month mark of the Iran war, with the spare global capacity that once cushioned such shocks, and OPEC's own regulating role, both gone.

This week, after the United States struck five Iranian oil tankers and Iran fired missiles at a US base in Jordan, Brent crude crossed $100 a barrel for the first time since July, the New York Times and The Hill reported.

In Gaza, where the war has wrecked the formal fuel-distribution network, the increase lands on an improvised generator market that has run the Strip's hospitals, water pumps and bakeries since the blockade tightened the official quota. UN agencies tracking Gaza's energy crisis have documented Gaza's fuel brokers, who resell diesel brought in through the crossings, pricing well above the West Bank's already Israeli-set rate.

Palestinian economists draw a distinction between two costs stacked on top of each other: the war premium moving through global crude markets, and the closure premium Israel's permit and crossing regime adds on top of it. A dialysis unit's generator, a bakery's oven and a water utility's pump absorb both at once, with no market mechanism available to a Palestinian consumer to shop around the second.