Costco says Americans are panic-buying one thing again - and it's not toilet paper

Costco’s gas business is seeing record-breaking sales volume as members use Costco pumps attached to warehouse locations. Members pay an annual fee to access the pumps, and Costco keeps fuel prices aggressively below competitors, typically 10 to 30 cents per gallon cheaper. Increased demand has required additional gas deliveries to maintain inventory. Rising fuel prices tied to events in the Middle East have increased consumer price sensitivity, leading many members to use Costco gas stations for the first time. Costco expects that more customers buying gas will also spend more inside the stores during the same visit.

"Costco operates its own pumps attached to its retail locations, which members who pay $65 annually can use to fill up. Like the food and goods inside Costco warehouses, the company's fuel prices aggressively undercut the competition - good business sense as customers grapple with affordability. The spike in demand was so significant that its pumps required additional gas deliveries to keep fuel stocked in the last few months."

""As events in the Middle East have had a significant impact on product supply and gas prices, our focus, as always, is to be there for our members by staying in stock and offering the best value," Costco CEO Ron Vachris said in the company's call with investors."

""The high consumer price sensitivity, which fueled these record volumes, also drove many members to use our gas stations for the very first time in the third quarter." Vachris expects that more users visiting Costco at the pump means more in-store shopping, as customers who get gas at Costco tend to spend more on their everyday shopping."

"For inflation-weary Americans, Costco's savings at the pump are substantial. The retailer's gas prices trend around 10 to 30 cents cheaper per gallon than the competition, and those savings are even more meaningful when fuel is expensive. Costco's strategy is to keep gas prices low, driving sales volume up instead of making more from each transaction."

Read at Fast Company