Costco has raised the price of motor oil sold under its exclusive private-label brand as well as limited how much of it customers can buy weekly as oil prices climb yet again.
Americans looking to try to save some money by purchasing motor oil to do their own oil changes may consider this yet another blow to their wallets, as they are already contending with high grocery prices and inflation worries
.Costco's Kirkland Signature full-synthetic motor
oil 5-quart two pack now costs around $58, well above the approximately $30 it had been selling for just last year. Costco is also only allowing customers to purchase two boxes a week.
The wholesale club operator is also limiting purchases of Mobil 1's full-synthetic motor oil 1-quart six pack, which sells for about $44, to five per membership.
Costco did not immediately reply to a request for comment.
Today's synthetic motor oil is heavily dependent on Group III base oils, which are mostly made from refining crude oil. It's estimated that the United States imports more than 40% of these oils from the Middle East, which has been dealing with disruptions to oil supplies since the start of the Iran war earlier this year.
The price for a barrel of Brent crude went above $109 on Monday morning as fighting in the Middle East keeps squeezing the global flow of oil.
An important Saudi oil pipeline will mostly be out of service for weeks following an attack last week, two regional officials told The Associated Press. The pipeline offered a way for Saudi Arabia to shift exports to the Red Sea and avoid the Persian Gulf’s Strait of Hormuz, where Iranian attacks have stifled the movement of oil tankers.
Brent has jumped from less than $72 in early July as doubts rise that the United States and Iran can come to an agreement that would allow oil tankers to freely exit the Persian Gulf through the strait again.
The rise in oil prices has helped send the average cost of a gallon of regular gasoline across the country to nearly $4.32 from $4.08 a month ago and $3.18 a year ago, according to AAA.
Meanwhile, diesel prices in the U.S. hit yet another record on Friday, soaring past $6 a gallon on average. On Monday, prices were still climbing, with diesel at $6.23 a gallon on average, according to AAA. A week ago, the average was $5.90 a gallon.
Prices at the pump for diesel and regular gasoline closely follow that of crude oil.
With oil prices continuing to rise due to ongoing tension in the Middle East, oil companies stand to profit more from turning refining crude oil into diesel or gasoline than motor oil. There's considerably more demand for diesel and gasoline worldwide than there is for motor oil, and the daily volume is high. So oil companies are likely to put more of their effort into diesel and gasoline and make less motor oil.
It remains to be seen if other motor oil retailers like Walmart, Amazon and AutoZone will boost their prices or set purchase limits. Walmart, Amazon and AutoZone did not immediately respond to requests for comment.
