Costco gas price variance reason

[SC Maintenance]

Costco sells its food at a break even or at a loss I believe.

Costco is not selling gas at break even or a loss. No one does. They sell at a lower price (and still profitable) to generate traffic and convince customers Costco is wholesome and good - so they spend more money there. They also make it up in volume - there is always a line.

Wholesale price of gas in LA is $2.32. Its likely similar in Oregon - EIA stopped publishing individual states a couple years ago. But of course everyone believes its the evil big oil companies gouging because that is what the mainstream preaches. https://www.eia.gov/todayinenergy/prices.php

The Costco here - which is in the city - is often more expensive than my local stations out here in the boonies.

 

[fdcg27]

This isn't really a Costco thing, although part of Costco's shtick is cheap fuel, so they have to price to local market and try to beat others by at least a couple of cents.
I'm sure that everyone has noted that gas markets are highly fragmented and localized.
We've all observed that some areas have consistently lower fuel prices while others are always higher.
Costco's pricing reflects this, as does that of every other fuel retailer.
This is an example of what is called zone pricing and it is not based simply upon local costs.
Another effect we all see is that when a new gas outlet opens, there is typically a brief price war between the new entrant and all of the nearby existing stations, which can bring bargain pricing from all at least for a little while.
Finally, there is some apparently irrational pricing. For example, does anyone really believe that E15 costs thirty cents less a gallon to produce than E10 RUG? That would be a typical discount offered on the E15 product at Sheetz.
Last Wednesday we took a trip north and passed through a small town. Fuel there was $2.389 for E10, so I filled up at the Sheetz at that exit with E15 for $2.059 including the .03/gal discount with Sheetz loyalty membership.
Quite the deal, but deals are where you find them.

 

[4wd]

$2.59 for Exxon yesterday …

 

[4wd]

Costco is not selling gas at break even or a loss. No one does. They sell at a lower price (and still profitable) to generate traffic

Gas creates a traffic jam at our Costco - out to the road - so you have to slowly filter past the pump mob even to go in a less desirable entrance …
Then inside - large groups of foreigners clog the aisles …
Done … will let it expire …

 

[oilboy123]

OK
No posting prices anymore! It makes me feel bad about myself.......... We are paying about $3.65 gall +........ I paid over $4 gall on Friday.

I think the gas tax here is about half the cost of gas..... Or at least it seems that way.

 

[B6_Dolphin]

Gas creates a traffic jam at our Costco - out to the road - so you have to slowly filter past the pump mob even to go in a less desirable entrance …
Then inside - large groups of foreigners clog the aisles …
Done … will let it expire …

I have the Costco Exec membership and since they announced the 1-hr earlier opening for Exec members earlier this year, I take full advantage and avoid the crowds.

 

[SC Maintenance]

OK
No posting prices anymore! It makes me feel bad about myself.......... We are paying about $3.65 gall +........ I paid over $4 gall on Friday.

I think the gas tax here is about half the cost of gas..... Or at least it seems that way.

Washington State is very high - 59.04 cents Google says.

So if you figure wholesale gas is about $2.32 per above, and add some transport - your in the approximately $3 a gallon cost to the station.

So you can see how some stations can charge $3.65 and others $4 - it likely depends on volume - location ,property taxes, labor and so on.

I paid $2.41 a gallon on my way home Thursday evening - along I-95 near Brunswick GA. Its about 30 cents a gallon more here - even though taxes are a nickel lower in SC than GA.

 

[si1491]

I usually fill up at that Twin Lakes Marysville Costco gas station whenever I am up in that area, about once a month for errands in the area. If we head out to Whidbey Island or Bellingham, I usually stop there to fill up on our way back south.

 

[405fwy]

HAH! We saw this too!! Why is Marysville so cheap?? Big crowd too.
Bellingham $4.29 (to screw us AND the Canadians) - maybe not income level
Marysville $3.69

I noticed that fuel was cheaper in Lynden compared gas stations in Ferndale/Custer which was nearer to BP Cherry Point.

 

[CarLuver]

whoever prices the southcenter costco is smoking crack every once in a while . . sometimes the price is higher than on the Eastside of Seattle . everyting in Seattle and Eastside within a 25 to 30 mile radius cost more. Everything from services to gas . I call it the east side tax .

 

[405fwy]

whoever prices the southcenter costco is smoking crack every once in a while . . sometimes the price is higher than on the Eastside of Seattle . everyting in Seattle and Eastside within a 25 to 30 mile radius cost more. Everything from services to gas . I call it the east side tax .

I used to fill up at Cenex stations for Ethanol Free. The price difference wasn’t too higher compared to E10, at least that made it worth it for me.

 

[Bob in Utah]

I used to fill up at Cenex stations for Ethanol Free. The price difference wasn’t too higher compared to E10, at least that made it worth it for me.

Eth free is readily available here in Utah…it’s 88 octane

Regular E10 is 85…20-25 cents difference

I keep 20-25 gallons Eth Free on hand in the barn

Along with full tanks in seldom used vehicles

Costco is 2 hours away so don’t frequent there often

Where’s the $2 gallon stuff we were promised ?

 

[405fwy]

Eth free is readily available here in Utah…it’s 88 octane

Regular E10 is 85…20-25 cents difference

I keep 20-25 gallons Eth Free on hand in the barn

Along with full tanks in seldom used vehicles

Costco is 2 hours away so don’t frequent there often

Where’s the $2 gallon stuff we were promised ?

Yeah it’s more common to find E0 at Maverik around there.

Back then I was lucky that the Cenex I lived nearby had 87, 89, 92 ethanol free top tier.

 

[duck__dodgers]

in my area, the "miserable" Costco that was built in the 90's, with much smaller than a modern Costco, and a completely crowded dumpster fire even during the week is always the cheapest for gas compared to the other local Costcos, even adjusting for taxes, etc. (10 to 15 cents cheaper than the closest Costco 25 min. away)

And unless it's very early or very late, plenty of people are always in the queues for the gas.

 

[4wd]

$2.59 for Exxon yesterday …

Same yesterday / been that for a while

 

[Carmudgeon]

Retail gas markets are highly localized. Trying to compare prices even in the same city is futile.