Motorists face a sharp hike in the price of fuel at midnight on Monday, when the monthly adjustment of the cost of gasoline takes effect. Drivers of diesel-fueled vehicles will feel the brunt of the new hikes, paying half a shekel (13 cents) a liter more following the last stage in a round of tax increases on both diesel and benzene the past several months.

The additonal taxes are part of a general reform that will add millions of shekels to Finance Ministry coffers as it attempts to reduce a deficit that has ballooned following a drop in tax revenues during this year's economic slump.

The increase in the price at the pump also reflects the recent spike in the cost of crude oil on the world market, which will cost drivers of benzene-fueled vehicles another 10-15 agorot (around three cents) a liter.

The bottom line will be that the cost of diesel at the pump, after the usual discounts, will be approximately six shekels ($1.58) a liter, and benzene will cost 6.4-6.5 shekels ($1.68-$1.71) a liter.

The rise in energy costs will be reflected in the September consumer price index, which is likely to show an inflation rate of more than one percent because of the added upward pressure from higher prices accompanying the Rosh HaShanah and Sukkot holidays.