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Taliban to Buy Oil From Iran as Fuel Prices Spike in Afghanistan

FILE - FILE - A gas flare on an oil production platform is seen alongside an Iranian flag in the Gulf.
FILE - FILE - A gas flare on an oil production platform is seen alongside an Iranian flag in the Gulf.

Afghanistan’s Taliban government announced Saturday it had signed an agreement with Iran to purchase 350,000 tons of oil from the neighboring country.

The Taliban-led Finance Ministry in Kabul said its high-level delegation visited Tehran last week where the two sides reached the deal to help reduce the price of fuel in Afghanistan.

It said that the import of petroleum products from Iran will begin in the next few days, and it will significantly reduce prices in Afghanistan. The statement shared no further details.

Fuel and gasoline prices have increased at an unprecedented rate in the country, where one liter of gasoline is currently priced at 99 cents and diesel at $1.32.

The Afghan and Iranian sides also agreed to establish a joint committee to propose ways to facilitate trade and transit of petroleum products, establish a gas pipeline for energy imports and build refineries in Afghanistan, said the ministry statement.

The contract signed with Iran will allow Kabul to import up to 350,000 tons of oil "based on a standard, proper price," local media quoted Abdul Ghafor, head of the official Afghanistan Oil and Gas Corporation, as saying.

Ghafor said that talks with Russia and Turkmenistan also were ongoing to sign deals for energy imports.

The United Nations, in its latest assessment, says that increasing global energy and food prices are seeping into the Afghan economy, resulting in high inflation.

In June, prices for diesel increased by nearly 23 percent, and yearly prices for basic household goods went up by 50 percent.

The U.N. lists war-torn Afghanistan among the world's largest humanitarian emergencies, where it estimates 18.9 million, nearly half of the population, could be acutely food insecure between June-November 2022, partly due to severe drought and economic crisis.