We haven't seen Agrabah post the flashback in 6x05. OUATIW shows Agrabah before Jafar met Aladdin.
Jafar became a genie roughly 2 years ago, while Agrabah disappeared seemingly 30+ years ago. It likely has nothing to do with anything genie related, but Jafar could have tried some trasportation spell that backfired.
Note: Agrabah is a sultanate, not a city. So, they are probably just talking about the Capital City, but it could be the entire kingdom as well. I guess the real question would be "How does Jasmine not know?" She should have been there when it disappeared and surely if it was Jafar he'd take her too.
Citoesqueleto123 wrote: She already said that she went for help to the land of untold stories and when she went back to Agrabah, it was disapear.
She went to the Land of Untold Stories to find Aladdin. Prior to this, she had gone to a neighboring kingdom for an alliance. On her way back through a sandstorm, she pushed through and found Agrabah was gone.