Major retail chains are pumping money into gas stations

Gas stations = the new oil rush. In recent months, US retail giants have accelerated their ongoing push into the auto fuel business, with new gas stations gradually popping up next to stores across the country.

While traditionally not a place to find pumps—outside of the shoe aisle—these retailers are hoping to increase customer loyalty with member discounts, draw in more foot traffic, and help fill up their bottom lines.

Examples include:

• Walmart last month kicked off a five-year strategy aimed at significantly growing the number of gas stations next to its stores, targeting 10% growth to 450 stations by the end of this year.
• Dollar General’s test run of a single gas station in Alabama has now expanded to 40+ stores, primarily in the South.
• Sam’s Club launched extended hours at 90% of its gas stations across the US last month.

Follow the leader: Costco is the unquestioned king of retail gas stations, with its 719 such locations accounting for ~12% of all company revenue last year. The big-box chain is pursuing further growth in this area and recently extended its gas station opening times across the US by at least 1 hour/day, CEO Rob Vachris said in Costco’s March earnings call.

The retail push comes as gas is getting cheaper. Average US prices for the Memorial Day weekend stood at $3.08/gallon, according to GasBuddy. It marked the lowest list price for the holiday since 2021, and the lowest inflation-adjusted price since 2003.

Looking ahead…Gas prices are projected to remain around that level through Labor Day—even with the switch to more expensive summer blends—amid rising US crude output and upcoming OPEC+ supply bumps.