Costco has long been the go-to destination for cheap gas. The warehouse retailer routinely charges about 30 cents less per gallon than most competing fuel stations, according to CNN. But Walmart may have found a way to challenge that dominance, and it is using a tactic borrowed from Costco itself.
At a time when gasoline prices are up 40.5% year over year, according to the most recent Consumer Price Index, those per-gallon savings carry real weight for budget-conscious drivers. Costco built its fuel reputation on consistent, significant discounts, enough that long lines at its pumps have become a well-known inconvenience.
Walmart is pushing back with its Walmart+ membership program. For $12.95 per month or $98 per year, Walmart+ members receive perks including unlimited free grocery delivery on orders of $35 or more and savings of up to 10 cents per gallon at thousands of gas stations throughout the U.S.
That fuel discount, combined with Walmart's broader retail footprint, could allow the company to undercut Costco on price at the pump while building customer loyalty among frequent shoppers.
During Walmart's first-quarter 2027 earnings call, CFO John Rainey said Walmart+ membership fee revenue growth accelerated. "In this period of elevated gas prices, members are tapping into their fuel savings benefits even more today," he added.
Walmart also holds a structural advantage over Costco at the pump. Costco requires a membership to shop and fill up. Walmart does not. Customers who come to a Walmart store for groceries or household items may choose to fill up simply because they are already there, whether or not they subscribe to Walmart+.
Costco does hold one edge that Walmart cannot easily match. Costco gas carries the Top Tier certification, meaning it uses five times the EPA-required detergent level. That is designed to reduce engine deposits and keep engines cleaner over time. Walmart's fuel discount may win on price, but Costco's product carries a quality certification that its rival has not matched.
