Panic Buying and Its Consequences for the Oil and Gas Crisis in Palestine After the War on Iran

In the context of the American and Israeli war on Iran and the subsequent Iranian military responses to bases in the Arabian Gulf, oil prices sharply increased, nearing the $119 per barrel mark before reverting to around $110, amidst daily fluctuations that reached as high as 28% in a single day, the highest daily increase since 1988. These sharp rises have revived memories of major energy crises like the 1970s crisis and the Russian invasion of Ukraine in 2022, but today they are more complex due to the deep interconnection between financial markets and global supply chains.

In Palestine, these developments have directly reflected on fuel prices for March 2026, where the price of 95-octane gasoline increased to 6.85 shekels from 6.71, and 98-octane gasoline rose to 7.80 shekels from 7.66, while the prices of diesel and kerosene reached 5.96 shekels from approximately 5.79. Economic estimates indicate that the price of gasoline could reach around 9 shekels per liter if prices in Israel rise to 10 shekels at the beginning of next April, which would represent an additional burden on citizens who consume more than a billion liters of fuels annually, averaging 90 million liters monthly, including 67.5 million liters of diesel and 22.5 million liters of gasoline.

The impact is not limited to Palestine but extends to the entire world. In Europe, natural gas prices rose by 15% in the last week, and in the United States, gasoline prices increased by more than 10%, reaching an average of $3.85 per gallon, while Asian markets saw shipping costs rise by 18% due to supply line disruptions in the Gulf. These figures reflect that the crisis is not merely local or regional; it is a global crisis threatening to trigger a wide-ranging inflation wave that could reach 6% in some major economies if prices remain at their current levels.

On the local front, the phenomenon of panic buying remains one of the most prominent economic features accompanying geopolitical crises. In the West Bank, with around 393,000 licensed vehicles as of the end of 2023, of which 174,000 operate on gasoline engines and 206,000 on diesel engines, consumers are rushing to stock up on fuel and gas out of fear of shortages, leading to a rapid depletion of available supplies and leaving wide segments without essential resources. This phenomenon is not new; Palestinian and global markets have witnessed similar behavior during previous crises such as the Russian invasion of Ukraine, where collective fear created an artificial scarcity that drove prices up beyond what the global market would dictate. The question now is whether the markets will be able to absorb this shock as they have in past experiences, or if the continuation of the war will make panic buying a multiplying factor in the crisis, increasing the vulnerability of the local economy and deepening imported inflation that could surpass 7% if prices continue to rise.

Alongside the fuel crisis, the domestic gas crisis in Palestine has worsened, particularly in the Gaza Strip, where supplies ceased for more than a full week, leading to a shortfall estimated at around 70% of actual needs compared to previously incoming quantities. The sector requires approximately 8,000 tons monthly, equivalent to 260 tons daily, to meet the minimum needs of the population, but the quantities that entered over the past few days excluded any gas shipments, before only four trucks entered on March 9, which is an amount insufficient to cover the increasing demand. This acute shortage threatens food and health security and disrupts basic humanitarian services, especially with the onset of Ramadan, increasing the needs of citizens.

It remains that oil and fuel prices are determined globally according to a complex equation involving supply and demand, geopolitical risks, production policies in OPEC, strategic stock levels, plus the exchange rate of the dollar, which remained relatively stable at 3.1 shekels per dollar during the last week. In Israel, and subsequently in Palestine, prices are subject to a government monitoring system that is updated monthly based on fuel prices in the Mediterranean region, plus local taxes and fees that account for around 50% of the final price. This equation makes the Palestinian market a direct hostage to global and Israeli developments, without having independent tools to mitigate the impact of shocks.

In conclusion, the question remains open: Will the expectations of rising oil prices to levels exceeding $140 or even $150 per barrel in the coming weeks materialize, thus reflecting on the Palestinian market with new increases that could push the price of gasoline to 9 shekels or more, and exacerbate the home gas crisis to unprecedented levels? Or will interventions from major countries through pumping their strategic reserves and providing additional supplies curb these increases and prevent prices from reaching record levels? The answer will remain contingent on the trajectory of the war and its developments, as well as the extent to which global markets can absorb the new geopolitical shock.