Costco in the United States raised the price of Kirkland Signature fully synthetic motor oil and implemented purchase restrictions, causing concern. (Picture taken from Costco official website)
Costco, an American-style store, has always been loved by consumers for its large portions and high CP value products, and the prices of some of its regular products are almost unchanged. (Reuters)
[Financial Channel/Comprehensive Report] The American-style store Costco has always been loved by consumers for its large quantities and high CP value products, and the prices of some regular products are almost unchanged, such as US$1.50 (about NT$47). Hot dogs, grilled chicken for US$4.99 (approximately NT$159), etc. Therefore, when the price of one of Costco’s standing items rises sharply and it begins to limit the quantity that members can purchase, the degree of concern is much higher than looking at the product price alone. Foreign media pointed out that Costco in the United States has now increased the price of Kirkland Signature fully synthetic motor oil and implemented purchase restrictions, causing concern.
American automotive media pointed out that the price of Costco's own brand Kirkland fully synthetic motor oil has increased significantly in recent years. 10 quarts (approximately 9.5 liters) currently sell for US$57.99 (approximately NT$1,846). In the past many years, the price has been as low as US$30 (approximately NT$955). What is more noteworthy is that Costco now also limits the number of purchases by members. Each member can only purchase once per transaction, and can only purchase up to 2 sets every 7 days.
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Costco's increase in motor oil prices is not simply a retail strategy. It involves factors such as tight supply, changes in refining profits, and increasingly stringent specifications for modern engine oils.
Kirkland 5W-30 fully synthetic motor oil currently meets General Motors' dexos1 Gen 3 specifications. This certification is not free. Engine oil products must be independently tested in accordance with General Motors' testing specifications and obtain formal authorization for different formulations before the industry can use the relevant logo on product packaging.
This licensing burden is superimposed on another burden faced by the entire industry. Starting in 2020, the American Petroleum Institute's (API) API SP gasoline engine oil grade and the ILSAC GF-6 standard are on the road, requiring the oil to pass 7 new laboratory tests, including a test for "low speed pre-ignition" (LSPI).
As car manufacturers improve fuel efficiency by downsizing engines and adding turbocharging in recent years, engine oils must also use more complex chemical formulas to withstand the working environment of small-displacement, high-load engines, further pushing up production costs.
On the other hand, the upstream supply chain is also facing pressure. Data from the U.S. Energy Information Administration (EIA) shows that as of early September, the U.S. gasoline crack spread was about $1 per gallon (about NT$31.85) higher than 2025 levels, mainly due to tight global gasoline supplies.
The "base oil" used in engine oil also comes from crude oil, which is the same source of crude oil as gasoline and diesel. When refiners' profits from processing crude oil into gasoline are higher than the raw materials for making motor oil, the supply of base oil will be squeezed, and costs will also be affected by changes in crude oil prices and refining profits, which are ultimately reflected in the selling price of motor oil.
Costco's motor oil purchase limit is actually a sign of tight market supply. Ordinary consumers will not hoard large quantities of motor oil like they did when they rushed to buy toilet paper in 2020. Therefore, when retailers begin to limit purchase quantities, it usually means that the product is difficult to maintain inventory, or the profit is too low for a single member to purchase in large quantities.
According to the report, what is really worth noting is not just the increase in selling prices, but when Costco, which is famous for its low prices and has long been willing to compress profits to reward members, begins to be unable to absorb the rising costs and adopts purchase restrictions to respond. This may mean that the manufacturing cost of fully synthetic motor oil required by modern engines has increased structurally, and the price may not return to the past level.
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