Market Watch: Fuel and Gold Dip as Sugar and Gas Climb in Kabul

KABUL – Kabul residents experienced a mixed bag of price movements in essential commodities this past week, with noticeable declines in fuel and gold providing some relief, even as staple food items and liquefied gas became more expensive, according to market sources.

The diverging trends highlight the complex interplay of global market fluctuations, currency exchange rates, and local supply chains that continue to shape Afghanistan’s economy.

Energy Sector Sees Diverging Trends

In a welcome development for motorists and transporters, the prices of petroleum products saw a modest decrease.

At the Ahmadyar pump station, a worker confirmed that the price of one litre of petrol had dropped from 70 Afghanis (afs) to 68 afs. Similarly, a litre of diesel now costs 77 afs, down from 80 afs the previous week. This decline is often linked to shifts in global oil prices and regional refining costs.

However, this relief at the petrol pump was offset by a rise in the cost of liquefied gas, a critical fuel for heating and cooking in many households. Mohammad Jan Amin, a gas seller in the Daha-i-Bagh locality, reported that the price per kilogram had increased from 54 afs to 55 afs.

Staple Food Prices: Sugar Surges, Others Hold Steady

The food market presented a stable yet costly picture for consumers. Zmarai Safi, head of the Food Traders’ Association, reported a significant increase in the price of sugar. A 49-kilogram bag of Indian sugar now sells for 2,400 afs, up 50 afs from the previous week’s price of 2,350 afs. Traders often cite import costs and international sugar commodity prices as key factors behind such hikes.

Other essential food items, however, saw their wholesale prices remain unchanged:

• A 16-litre bottle of Malaysian cooking oil: 1,650 afs

• A 24-kg bag of Pakistani rice: 2,600 afs

• A 49-kg sack of Kazakh flour: 1,500 afs

• One kilogram of African black tea: 380 afs

• One kilogram of Indonesian green tea: 350 afs

Retail Markup Highlights Consumer Burden
A visit to the Dahna-i-Bagh market, however, revealed the additional margin consumers pay at the retail level. Hamid Sufizada, a retailer, quoted slightly higher prices for all items, illustrating the standard markup from wholesale to retail:

• 49-kg sack of Kazakh flour: 1,550 afs

• 24-kg bag of Pakistani rice: 2,650 afs

• 49-kg sack of Indian sugar: 2,450 afs

• 16-litre bottle of cooking oil: 1,700 afs

• One kilogram of black tea: 430 afs

• One kilogram of green tea: 400 afs

Gold Prices Dip Slightly

The precious metals market also saw a minor correction. Mohammad Fawad, a jeweller in the Timor Shahi area, stated that the price of one gram of Arabian gold decreased from 6,800 afs to 6,770 afs. Russian gold followed a similar trend, falling from 5,380 afs to 5,360 afs per gram. Gold prices in Afghanistan are closely tied to international bullion rates, which are converted into local currency.

Currency Exchange Sees Minimal Change

The foreign exchange market remained largely stable. Haji Mohammad Hussain, owner of the Sadaqat Money Exchange Service, reported that the US dollar traded at 66.60 afs, a negligible change from 66.50 afs the previous week. The Pakistani rupee held steady, with 1,000 rupees exchanging for 230 afs. The stability of the Afghani against major currencies is a key indicator watched by economists and importers.

Analysis: A Tale of Two Markets
This week’s price movements underscore the competing pressures on Afghan households. The drop in fuel costs can lower transportation and generator expenses, providing a small boost to business activity and family budgets. However, the simultaneous rise in sugar and liquefied gas, both household essentials, immediately reclaims that financial breathing room.

Market analysts suggest that while global factors influence fuel and gold, the increase in sugar and gas points to persistent challenges in supply chain logistics and import dependencies. As the new week begins, consumers and traders alike will be watching to see if these trends solidify or reverse.

 

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