The Secret of Costco Gasoline: A 1,500-Gallon Underground Tank and the 3-Cent Paradox
When Gas Prices Rise, Costco Smiles Summer 2026. San Antonio, Texas. Cars line up around the block at a Costco gas station. A thirty-minute wait. As fuel prices soared, drivers flocked in search of cheap gas. But here's the strange part. When gas prices rise, ordinary stations suffer as their margins get squeezed — yet Costco smiles. Because it sells even more gas. In the third quarter of 2026, Costco posted its biggest quarterly gasoline sales ever. Today, we dig into the secret of Costco gasoline : a 1,500-gallon tank hidden beneath the station, and the 3-cent paradox. 1. The Price Secret — Gas Is the Bait Costco's margin is just pennies per gallon, compared with twenty-five to thirty-five cents at ordinary stations. Yet Costco insists it is not a loss leader: "it actually makes money" (CNN). A few cents is still a profit. The trick is scale. A single Visa deal keeps card fees low, and enormous volume spreads operating costs thin. At a station where tanker ...