For residents of Israel such as yourself, PayPal may indeed be the most cost-saving way to withdraw funds.
But keep in mind that if you withdraw your funds to a U.S. bank account, there are zero fees. So that is even cheaper.
It is not as simple for residents of Israel to open a U.S. bank account as it is for U.S. residents to do so. But as you probably already know, many residents of Israel do indeed maintain U.S. bank accounts. And Upwork allows residents of ANY country to withdraw their funds to a U.S. bank account.