Costco says its gas stations set all-time volume records as consumers seek lower-priced fuel

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Costco’s gas stations experienced a surge in demand during the most recent quarter as consumers flocked to its low-priced gasoline, helping the company exceed market expectations for third-quarter sales.

CEO Ron Vachris highlighted the impact of ongoing macro uncertainty on consumer behavior, with households seeking out affordable options. This led to an increase in members visiting Costco’s gas stations.

“The highlight of the third quarter has been our gas business. With significant disruptions in the Middle East affecting product supply and gas prices, our focus remains on providing the best value to our members,” Vachris stated.

“This focus resulted in record-breaking volumes, setting successive all-time company volume sales records in each four-week fiscal period of the quarter. The final five weeks of the quarter also marked our top five volume weeks ever,” he added.

Costco’s gas stations have seen a rise in demand for their low-priced gasoline, as the surge helped the company top expectations for its third-quarter sales. Bloomberg via Getty Images

Vachris praised the Costco team’s efforts in managing the necessary deliveries to meet the demand, including multiple daily gas deliveries to various locations.

The energy markets were disrupted by the Iran war, causing gas prices to exceed $4 a gallon nationwide due to constraints on global oil supplies from the closure of the Strait of Hormuz, pushing crude prices above $100 a barrel.

Recent AAA data reveals that the national average price for a gallon of regular gasoline was $4.39 on Friday, marking a 38% increase from the average of $3.17 a gallon a year ago.

Vachris emphasized that the affordable gasoline offered at Costco stations attracted new members and customers, driving further sales momentum for the wholesale club in the future.