Costco's Price Hike Hits Customers Amid Synthetic Oil Shortage
Costco Wholesale (COST) has hiked the price of its Kirkland Signature full-synthetic motor oil, nearly doubling it to $58 per 10-quart pack. This move is unusual for the retailer known for keeping prices down.
The reason behind this price increase lies in the shortage of Group III base oil, which Costco imports from the Persian Gulf at around 44%. Conflict in the region and a March airstrike on a Qatari facility have disrupted global supply, with at least one major supplier expected to be offline for a year.
Costco's concentrated selection model makes the shortage more visible compared to its competitors like Walmart (WMT), Amazon (AMZN), and AutoZone (AZO). These retailers offer a wider range of brands, giving shoppers alternatives when one product is harder to source. Costco's bulk model can make it among the first to show the strain.