A commodity is a basic raw material the world uses every day. Think oil for fuel, copper for wiring, wheat and rice for food. You rarely buy these items directly, yet their prices quietly shape what you pay for petrol, groceries, and electricity.

Why it matters to you. When core inputs get pricier, costs ripple through the economy. Fuel hikes raise delivery and commuting costs. Grain spikes lift the price of bread, cereal, and animal feed. If you run a household or a small business, knowing the few big drivers helps you plan purchases, set prices with some cushion, and avoid being caught out by sudden jumps.

What moves prices most are real-world disruptions and what people expect will happen next. Weather can shrink harvests, storms can shut refineries and ports, and wars or sanctions can block key shipping routes. Policy shifts and taxes can add to costs, while good harvests, new supply, or calmer geopolitics can ease them. Prices can move quickly, but the reasons are often simple to grasp once you watch the basics.

Recent years offered clear examples. Conflict around major grain exporters pushed global food costs higher. Tensions in the Middle East have, at times, lifted oil prices as buyers worry about supply. These shocks travel fast into fuel, transport, and food, which is why they show up so quickly in household budgets.

Day to day changes in your cost of living often come from swings in basic goods like oil and wheat. If these prices rise, fuel and food usually cost more. Keep an eye on fuel and staple food prices. When they start climbing, delay long trips, buy essentials when they are on special, and add a small buffer to your monthly budget.