Based on my understanding of your query, Yes, Azure is launching new region in Israel (Israel Central).
Choose the right Azure region, not just for gaming but consuming/deploying any service in a region nearby to your preferred location is a right thing to do for reducing the latency.
I would suggest you to try West Europe or North Europe regions as geographically these are the 2 data centers nearer to Israel. You can do a Latency test by deploying a sample application on both of these regions and then can decide which region to use till the Israel region is launched.
Hope this helps.
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