Amazon does not operate gas stations, so it generally can’t compete with Costco’s low-priced gas pumps.
The gas stations at the membership-based chain drive members to its warehouses, which leads to them going into the stores.
Costco CEO Ron Vachris said during the company’s fiscal Q3 earnings call that gas customers tend to become higher-value members over time.
“We believe this will drive even greater loyalty with these members in the future as members who use our gas stations typically spend more with us in the warehouse,” he shared.
Costco’s fuel operations are widely viewed as traffic-driving amenities that encourage more frequent in-store shopping. Retailers are competing for a larger share of household discretionary spending, particularly around seasonal events like Independence Day.
Now, Amazon has a new holiday deal for Prime members that might keep them from making the trip to Costco,
Amazon offers a chance for a cheap fill-up
Having just passed Prime Day, Amazon wants to keep its sales momentum up as the Fourth of July holiday approaches.
“87% of consumers plan to celebrate the Fourth of July in 2026 and spend a record average of $94.41 on food items,” according to the National Retail Federation Fourth of July 2026 report.
In addition, the study shows that 62% of people celebrating will do so with a barbecue or picnic, which creates sales opportunities for both Amazon and Costco. By giving Prime members a chance to fill-up at a gas station that might be closer to home than Costco, the retailer could win more of the sales connected with those celebrations.
Amazon explained how the deal works on its website.
“Prime members can link their Amazon account to Earnify and save 50¢ off per gallon July 2-5 only (one-time use). Simply enter your phone number or use the Earnify app at 7,500 bp, Amoco, and participating Thorntons locations. Before July 2, Prime members save 10¢ per gallon,” the company shared.
Joining Earnify gives members a baseline savings of $0.05 per gallon with Amazon offering to match that until July 2, when an additional $0.40 per gallon will be offered until the end of the day on July 5.
“Once the promotional period concludes, Prime members will be able to access a total of 10¢ off a gallon at participating stations,” Amazon shared.
Amazon framed the promotion as part of its broader summer savings strategy.
“Summer is a time for making memories, and Prime is here to make the entertaining more affordable,” said Amazon Vice President Carmen Nestares in a press release. “…this July 4 holiday we’re excited to introduce $0.50 per gallon fuel savings.”
The retailer is also offering Prime members a $5 monthly grocery credit from July through September, applied automatically at checkout on orders of $25 or more, up to $15 in total savings.
Gas prices have fallen but remain high
“Drivers are continuing to see relief at the pump as the national gas price average declines for the fifth consecutive week. Today’s national average is $3.91 per gallon. Crude oil prices have also continued to fall as the U.S. and Iran work toward a long-term deal,” according to AAA.
Despite lower prices, demand could rise as a record number of Americans prepare to travel for Independence Day weekend, with 85% planning to drive to their destinations.
- June 29 National Average: $3.918
- One Week Ago: $3.999
- One Month Ago: $4.507
- One Year Ago: $3.227
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Costco keeps it simple
While Amazon’s deal may be enticing for non-Costco members, RTMNexus CEO Dominick Miserandino won’t see its customers go elsewhere because the warehouse club makes getting low prices easy for members.
“Costco wins because its value proposition is completely frictionless. You show your card, and you get the lowest price in town immediately,” he told TheStreet.
More Costco:
- As consumers struggle, Costco sets a troubling record
- Costco makes an even bigger bet on its house brand
- Costco just lowered prices on key items
He was critical of a recent Kroger promotion which, like the Amazon deal, required steps beyond just tapping your membership card on the pump.
“Kroger’s model requires digital coupon clipping, tracking specific calendar windows like ‘4X Fridays,’ and monitoring point balances. In a tight economy, convenience-fatigued consumers eventually reject complex loyalty gamification,” he added.
Miserandino does think the gas promotion will be seen as a positive by Prime members.
“In this economy, gas is king and it’s a good way to increase loyalty,” he wrote.
Americans do want gas savings
Consumers are looking to save money on gas, and high gas prices are forcing them to cut back in another area, according to a Numerator survey of more than 1,000 U.S. consumers. Key findings included:
- 93% of drivers are trying to save money on gas.
- 36% choose stations based on price over convenience.
- 61% say gas prices are impacting ability to afford other expenses.
With gas prices averaging more than $4 per gallon, BMO Capital Markets Senior Economist Sal Guatieri explained that most Americans will have to spend less in other areas.
“Apart from undermining confidence, the increase will erode spending power, particularly for lower-income households. Gasoline and other fuels account for 2% of U.S. personal consumption, so the price increase, if sustained, could cut annual spending by about 0.7%. That works out to more than $1,000 for the average American household,” he wrote.
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