The potential cost of removing the oil has not yet been calculated. The quality of the oil and exact quantity will not be known until extraction begins.
Yuval Bartov, chief geologist of Afek Oil and Gas, a branch of US firm Genie Energy, told Israel media that its discovery was "significant" and had caused "enormous excitement".
Genie saw shares rise by almost 20 per cent in New York after news of the discovery broke. The company's chief executive and chairman, Howard Jonas, said he was "optimistic" that the potential benefits of the find could be maximised.
But some energy experts were sceptical. Previous oil fields discovered in central Israel failed to live up to expectations once extraction work started.
There could also be legal complications. Environmental groups have complained about the impact of the drilling and took their case to Israel's highest courts.