El Al is facing a NIS 121 million fine after Israel’s competition watchdog alleged that the country’s flag carrier exploited its monopolistic power and charged “excessive and unfair” fares during the war with Hamas in Gaza.

The Israel Competition Authority said on Sunday that it notified El Al that it intends to impose the maximum sanction stipulated by law in the amount of up to NIS 121 million ($39 million). The decision on the determination and imposition of the financial sanction is not final and is subject to a hearing where El Al will present its position.

With the outbreak of war with Hamas on October 7, 2023, El Al became a monopoly on most of its routes after many foreign carriers canceled flight services to and from Israel due to heightened regional tensions.

During the two-year war, El Al raked in record profits as major foreign airlines repeatedly halted flight services to and from Israel, leaving travelers from Tel Aviv’s Ben Gurion Airport almost entirely dependent on Israeli carriers. A scarce supply of flights allowed El Al to charge exorbitant airfares.

“The security situation led to an extreme situation for the traveling public,” Israel Competition Authority head Michal Cohen said.

“The entire period was........

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