A single cigarette in Gaza now costs as much as a meal did before the war. The price of one imported cigarette from brands like Marlboro or Imperial has climbed to 40 shekels, roughly $13.06, a 4,000 per cent increase from pre-war levels.
In the past month alone, prices have surged by 700 per cent. Analysts say this is not a supply shortage. They point instead to Israeli border policies and a smuggling scandal involving reservists and the brother of Israel's intelligence chief.
At the same time, some merchants who have learned to read the political winds have been accused of hoarding goods to profit from the uncertainty.
According to Muhammad Barbakh, an economics professor at the Islamic University of Gaza, before the war, Gaza consumed around seven million cigarettes a day, imported through legal channels in some 700 cartons that crossed the border daily.
“Since the Israeli military seized the Rafah crossing in May 2024, not a single carton of cigarettes has entered Gaza through official, legal means,” he told The New Arab.
Every cigarette smoked in the strip since then arrived through smuggling networks, a trade now under intense scrutiny following a corruption case that has shaken Israel's political and security apparatus.
The recent price spike traces directly to what Israeli media now calls the cigarette affair. In early February 2026, Israeli prosecutors charged 12 individuals and one company in connection with a smuggling ring that funnelled cigarettes, iPhones, batteries, communication cables, and car parts into Gaza.
Among those charged was Bezalel Zini, the 50-year-old brother of David Zini, the chief of Israel’s intelligence agency, the Shin Bet.
The smuggling scandal and its fallout in Israel
Zini, a reserve officer who commanded a civil engineering team inside Gaza, is accused of smuggling roughly 14 crates of cigarettes into the strip on three separate occasions, each crate containing 50 cartons, or about 7,000 packs in total.
He allegedly received 365,000 shekels, around $119,000, for his role. Prosecutors say the ring exploited military convoys and deceived soldiers at checkpoints by presenting the smuggling runs as authorised security operations.
The charges against Zini include "assisting the enemy in wartime," a grave accusation rooted in the Israeli argument that Hamas collects taxes on smuggled goods, funnelling hundreds of millions of shekels into its coffers since the war began.
Zini's father, Rabbi Yosef Zini, said that the investigation was politically motivated and ultimately targeted his other son, the Shin Bet chief himself.
Israeli affairs analyst Ahmad Fayad said the fallout from the scandal prompted authorities to tighten inspections across all three active crossings into Gaza: Karem Abu Salem (Kerem Shalom) in Rafah, the primary entry point, along with Kissufim in Deir al-Balah, and Zikim in the north, both of which operate on a limited and intermittent basis.
The crackdown has extended beyond cigarettes, impacting the prices for batteries, solar panels, and mobile phones as smuggling volumes contract.
Gaza's wartime economy
Barbakh described Gaza's wartime economy as something he calls "the economics of the bizarre," a term he said does not exist in any textbook but captures the contradictions at play.
“Trade is restricted and controlled by the occupation. People's finances are at their lowest point in memory,” he told The New Arab. “Yet demand remains enormous, and prices swing wildly based on political signals rather than supply curves.”
Merchants have learned to anticipate. When military operations ease and crossing traffic picks up, prices drop, sometimes before new goods even arrive. When escalation looms, prices jump immediately, even if warehouses remain stocked.
Barbakh pointed to cigarette traders specifically, noting that many have hidden existing inventory in anticipation that the smuggling window will close in the foreseeable future. Israel currently permits only 10 Gaza-based importers to bring goods through four Israeli-approved companies, and cigarettes are not on the list of permitted items.
“Gaza's economic and oversight bodies lack the capacity to control prices on smuggled goods of unknown quantity,” Barbakh said, “particularly after Israel destroyed much of the government's institutional infrastructure during the war.”
He added that Gaza’s Ministry of Economy staff can often be found standing on certain roads trying to count trucks, but they cannot track all of them, and they have no authority over what is inside.
A pressure tool
Muhammad Abu Jiyab, editor-in-chief of Gaza's Al-Iqtisadiya newspaper, argued that Israel's refusal to allow cigarettes through official channels while simultaneously cracking down on smuggling fits a well-established pattern of economic blackmail.
"Every file that could ease life for people in Gaza is subject to extortion. That has been the occupation's method for two decades," he said. "If they extort over medicine, why would cigarettes be any different?"
Abu Jiyab noted that cigarettes previously entered through so-called "yellow cars," trucks that crossed into Gaza with the knowledge and coordination of Israeli security agencies. That channel dried up after the smuggling scandal broke.
He expects prices to keep rising if Israel maintains its stranglehold on the crossings, and said any real stabilisation depends on political developments, particularly the anticipated handover to Gaza's new administrative committee, which some of his sources expect to take charge by the end of Ramadan.
Fayad went further, arguing that denying small luxuries like cigarettes is a calculated component of Israel's displacement strategy.
“The cumulative psychological toll compounds the misery of displacement, destruction, and scarcity,” he said.
The Israeli military previously dropped cigarettes from drones as an inducement for cooperation, Fayad noted, evidence that the authorities understand exactly what they are doing.
Israel has, for example, taken the opposite approach with flour, flooding Gaza's markets until prices plummet and Hamas cannot profit from its sale.
Fayad pointed out that if the stated goal is to deny Hamas revenue, authorities could simply flood the market with cheap cigarettes and eliminate the markup.
"Cigarettes are not dual-use items," he said. "The unstated goal is to make life in Gaza impossible, to push people toward leaving. This is part of that political logic."
Mohamed Solaimane is a Gaza-based journalist with bylines in regional and international outlets, focusing on humanitarian and environmental issues
This article is produced in collaboration with Egab
Edited by Charlie Hoyle