【TMGM Financial Recap】Israel Votes Today! Netanyahu Faces a Major Political Test, with Oil Prices Also at Stake

Israel votes today in its election for the 26th Knesset. This is the first national election since the latest round of the Israeli-Palestinian conflict erupted in October 2023, and the first since 1988 to be held on schedule. Incumbent Prime Minister Netanyahu, who is seeking reelection, is 77. He first became prime minister in 1996 and has served for a total of nearly two decades. Voting for Israeli military personnel began more than a week ago. Around 850 polling stations cover operational positions in Gaza, Lebanon, and Syria, with roughly a quarter operating as mobile stations. Ballot boxes are locked during transport and escorted by armed officers. Israeli law also prohibits the publication of new polls from last Friday until polling stations close. Polling stations close at 22:00 tonight, with exit polls released immediately afterward. 

Pre-Election Polls: 52 Seats Versus 50, Both Far from 61 

The latest available reference is the final round of legally permitted pre-election polls: KAN and Channel 12 put the opposition bloc at 52 seats and Netanyahu’s bloc at 50 on October 22; Channel 13 showed 54 versus 50, while another Channel 12 poll showed 56 versus 50. The opposition’s lead varies from two to six seats across pollsters, but the overall picture is consistent: the opposition is slightly ahead, and neither side has a majority. 

At the party level, Eisenkot’s Yashar party is projected to lead with 22 seats, followed by Netanyahu’s Likud with 20 and former Prime Minister Bennett’s “Unity” party with 14. Ben-Gvir’s Jewish Power, Lieberman’s Yisrael Beiteinu, and Golan’s Democrats are each projected to win around eight seats. 

Forming a government requires 61 seats, a majority in the 120-seat Knesset. Neither the 52 nor the 50 seats shown in the polls reaches that threshold. Eisenkot has ruled out several options. He has explicitly stated that he will never join a government with Netanyahu, saying that “a rotation arrangement is also completely out of the question”; he is also unwilling to bring Arab parties or ultra-Orthodox parties into the cabinet. The additional seats needed to move from 52 to 61 lie primarily among these groups. 

Netanyahu’s challenge lies in his allies’ demands: support for the far-right Ben-Gvir is rising, with his party projected to win at least eight seats; the ultra-Orthodox Shas and United Torah Judaism parties have declared that they will not join a government unless military service exemptions are enshrined in law. 

The Arab parties hold a pivotal position. Arabs account for roughly one-fifth of Israel’s population, and two Arab parties are projected to win a combined 14 to 16 seats. Yet some in the opposition bloc would prefer another election to cooperating with them. Several smaller parties are also hovering around the 3.25% electoral threshold, and whether they enter parliament will reshape the allocation of seats. 

The government formation process is also set out in law: within seven days of the publication of the official results, the president decides who will receive the first mandate to form a government. Negotiations last 28 days, with a possible 14-day extension; failure to form a government leads toward another election. Britain’s The Guardian offered another assessment: Netanyahu is skilled at exploiting political divisions and has extensive experience in coalition building. Even without a clear advantage in the results, he may still secure another term through negotiations. 

The Dividing Line in This Election Is No Longer Left Versus Right 

Eisenkot’s campaign slogan is “a country without lies,” emphasizing political integrity and government accountability, alongside a proposal to limit prime ministerial terms. The dividing line in Israeli politics has shifted from the traditional contest between left and right to a confrontation between pro-Netanyahu and anti-Netanyahu blocs. The opposition itself is fragmented: former Prime Minister Bennett and former Defense Minister Lieberman differ significantly from the center-left on security policy. 

Voters are most concerned about two issues. One is who should be held responsible for the security and intelligence failures of October 7, 2023, a question Israeli society has debated for three years. The other rose rapidly in prominence in the months before the election: military service exemptions for the ultra-Orthodox. These exemptions date back to 1948, when Ben-Gurion reached an agreement with the ultra-Orthodox community exempting religious school students from military service. With Israeli forces continuing operations in Gaza and southern Lebanon and reservist manpower under strain, that agreement has been pushed to the forefront of the political agenda. The Supreme Court ruled in 2024 that the exemptions had no legal basis, but the government has continued to implement them. Opposition parties have included compulsory military service in their election platforms, while Yashar has proposed criminal prosecution for draft evaders. 

The economy has not become an election issue. The International Monetary Fund forecasts Israeli growth of 4.5% in 2026, the highest among advanced economies; meanwhile, 58% of survey respondents believe the security situation is poor. After three years of warfare, voters are choosing the country’s direction. 

Eisenkot, 66, is a former chief of staff of the Israel Defense Forces and comes from a family of Moroccan Jewish immigrants. His son and two nephews were killed in Gaza. If elected, he would become Israel’s first prime minister of Mizrahi background. 

If No Government Is Formed, Netanyahu Remains as Caretaker Prime Minister 

If government formation fails, Netanyahu will remain as caretaker prime minister until the next election. During the caretaker period, the incumbent government continues to exercise its powers, including authority over military decisions. 

Exit polls arrive tonight, official results are due by November 4, and the president then has seven days to designate a candidate, followed by 28 days of negotiations; the United States votes in its midterm elections on November 3. Two or three months could pass between today and the formation of a new government, with the process overlapping the U.S. midterms throughout. 

Washington has already made its position known. Trump called Netanyahu a “great wartime prime minister” on October 18, then posted a direct appeal to Israeli voters to vote for Likud on October 25; Vice President Vance said he would not get involved. 

Military action against Iran is also scheduled after these political milestones: Defense Minister Katz denied that there were plans for a strike before the election, while Israeli media reported that military assessments placed the resumption of operations after both elections. 

Oil prices moved first yesterday. Senior officials from Saudi Arabia, Pakistan, and Türkiye arrived in Tehran on the same day, marking the first such contact since the war began in February. Topics included shipping arrangements through the Strait of Hormuz; international oil prices fell around 1.5% that day. When tonight’s exit polls are released, the first thing to watch is how many seats each bloc remains short of 61. The larger the shortfall, the longer the caretaker government stays in office, and the more slowly the conflict premium in oil prices will recede.