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What story hides in the price of propane? IraqSlogger’s exclusive data documents major fluctuations in the price of cooking gas, a widespread household fuel, in August and September, in Baghdad and in the Iraqi provinces. In a striking way, the data capture the history of the last two months in Iraq.
Cooking gas (ghaz al-tabkh) is a staple purchase for Iraqi households. The fuel, usually a mix containing butane or propane, is used for food preparation in the home. Cooking fuel is sold in reusable standard-sized cylinders which are exchanged at fuel stations when emptied (see photo above).
The Iraqi government set the “official price” of a canister of cooking fuel at 4,000 ID, but only recently and only in a small number of places has that price been achieved at the street level. As with auto fuel, a significant black market for cooking gas thrives in Iraq where prices can be many-fold higher than the official rate. In addition to the problem of general scarcity, armed groups and even unscrupulous fuel merchants can also create an artificial shortage at the official fuel stations by directing fuel supplies to the black markets, seeking higher profits or financing militia activities. Even so, market forces on the black markets lead to significant fluctuation in these generally higher prices.
Looking first only at cooking fuel prices in Baghdad, IraqSlogger’s sources provided data for cooking gas prices in nine disparate Baghdad neighborhoods over the last two months.
(See a map marking the location of the nine districts.)
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As IraqSlogger’s exclusive data show, cooking gas prices on the unofficial markets trended uniformly down across the nine Baghdad areas in August and September, a pattern that generally parallels the trend in automobile fuel prices.
Note that in all Baghdad neighborhoods the street price of a cylinder of cooking gas is several times , the officially set price of 4,000 ID per cylinder, even at the lowest point. It bears noting that even the rate of 4,000 ID/cylinder is itself considered high by Iraqi standards.
Data comparing cooking gas prices in most Iraqi provinces over the same time period tells a fascinating story.
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The Baghdad drop in cooking gas prices, observed in parallel by IraqSlogger’s sources in the nine neighborhoods, is a clearly observable feature on the chart, dropping sharply from the highest data point on August 25 and settling on a measured average of 16500 ID/canister in late September. (The Baghdad chart above notes prices as low as 11,000 ID/canister in Sadr City, at the low end of the spectrum at the last sample in Baghdad’s neighborhoods on September 29).
Although the national data are incomplete, several striking trends are visible.
The first noteworthy point is the geographical clustering of the prices. For the dates surveyed, almost without exception, provinces south of Baghdad featured far lower cooking gas prices than the provinces of Baghdad and to the north, where data are available. For all dates in August and September, cooking gas prices in the southern provinces cluster towards the bottom of the scale.
The only exception to this trend is the cooking gas prices in the province of Karbala, which spiked in late August and remained higher than the rest of the south for as long as data are available.
In addition to the regional clustering in prices, zooming in on the last two weeks of August and the first measurement of September highlights another marked north-south difference in cooking gas prices.
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Note the uniformly downward trend from late August in Baghdad and the northern provinces for which data are available, while at the same time cooking gas prices spiked up in nearly all the southern provinces. (The two exceptions are Babil, where prices did not change between August 25 and September 1, and Qadisiya province, where prices eased between Aug 25 and Sept 1 after climbing earlier in the month.) Broadly similar trends can be observed in the black-market price of gasoline over the same two-week period for the same northern and southern provinces.
This trend would appear to reflect the tension and unrest that flared in southern Iraq in late August and early September, most notably with the deadly fighting that broke out in the Shi'a shrine city of Karbala between reported Mahdi Army elements on the one hand and Iraqi security forces and the local shrine security forces on the other. With a death toll of at least 52, the fighting catalyzed tensions throughout the Iraqi south. The initial clashes broke out in Karbala on the evening of August 27, between the August 25 and September 1 price samples, the point in time when price trends in the northern and southern provinces diverged markedly.
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A close-up look at the southern provinces reveals a few interesting trends as well. The least amount of variation is over the last two months is observed in Basra, where street prices have converged with official prices in the last week. Basra’s cooking gas prices largely follow the trends of its street prices for gasoline, which have trended downward since September.
As noted, cooking gas prices (and auto fuel prices) almost uniformly spiked in the southern provinces after deadly clashes broke out in Karbala in late August. Note especially the pronounced spikes in Najaf and Karbala, two major Shi'a shrine cities in the Iraqi south where tensions soared between rival factions after the fighting, including curfews imposed in both places and attacks by Mahdi Army elements against supporters of the Shi'a parties associated with the Shi'a Da'wa and Supreme Iraqi Islamic Council
As noted above, Karbala, the epicenter of the late August/early September unrest, saw the highest street prices for cooking gas of the southern areas in late August and early September, rivaling those of some northern provinces.
Working backwards through time into mid-August, note also the late August spike in the price in Muthanna province. This price spike was observed in the time after the assassination of the provincial governor in an IED blast, and the unrest that followed. Muthanna’s governor, Muhammad al-Hasani, was assassinated on Monday August 20, between the August 18 and August 25 price measurement. While Muthanna’s prices climbed in this period, most other southern provinces saw prices relax. (Babil province was the other exception).
Curiously, Qadisiya Province, where the provincial governor, Khalil Jalil Hamza, was assassinated two weeks before the governor of Muthanna -- also in an IED blast -- did not see the same spike in cooking gas prices in late August/early September after the Karbala fighting.
However, prices did peak in Qadisiya province just after the August 11 assassination of Governor Hamza, but then dropped to the 5,000 ID/canister mark in early September, and have only risen again in late September, quite possibly related to tensions and supply constraints associated with a new “security plan” in the province, which authorities recently said was only half-controlled by government forces. Heavy fighting last week in Diwaniya, the provincial capital, is likely reflected in spiking cooking gas prices in the latest measure. (It is also noteworthy, and curious, that gasoline prices in Qadisiya appear to follow the reverse of the trends of cooking gas prices. Qadisiya has been at the high point of the sampled Iraqi provinces in the price of automobile fuel throughout September.)
To view this data in table format, click here. cookinggaspricesAug_Sep2007.htm
This article is part three of a series looking at exclusive information obtained by IraqSlogger tracking the prices of several essential fuel and non-fuel commodities in nine different Baghdad neighborhoods, and across most Iraqi provinces for August and September. The first installment found a generally downward trend in gasoline prices throughout the country over August and September, while the second article showed that auto fuel prices, at least in Baghdad, moved downward independently of two nonfuel staples: bread and cigarettes.
IraqSlogger has more exclusive prices data to crunch for August and September, so stay tuned for the next installment.
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