Costco nearly doubles price of store brand motor oil as global supply pressures heat up

Long Island consumers buying Costco’s store brand motor oil will pay nearly 50% more than they did last year as the impact of rising crude oil prices ripples through the economy.

Costco, a warehouse club, recently raised prices and limited sales of its Kirkland Signature brand synthetic motor oil to two boxes per customer a week, according to The Associated Press.

Rising oil prices, supply constraints and disruptions in the global oil market have driven up the cost of synthetic motor oil since the U.S. war with Iran began in February, forcing local auto shops to pay hundreds of dollars more for supplies, according to local businesses and industry experts. Costco’s price hikes are part of that broader increase, with higher costs increasingly being passed along to consumers.

Synthetic motor oil is dependent on Group III base oils, which are made from refined crude oil, according to AP. The oil is used in automobile engines to lubricate pistons and prevent corrosion.

But as crude oil prices have spiked, so has the average retail price for motor oil sold on the internet, data shows.

While prices vary for synthetic oil based on quality, the average price for 5 quarts of motor oil has increased by as much as 16.6% to 25.7% between February and August, according to data from JobbersWorld, an industry publication.

Overall motor oil prices have increased by an estimated 24.2% between Feb. 2, before the war in Iran started, and Aug. 10, according to analysis from JobbersWorld.

"What it means for the consumer is all of sudden they are going to do a double take when they see the price of their oil change," said Thomas F. Glenn, president of Petroleum Trends International, a market research and consultancy firm.

Oil change businesses “are going to have to be creative in terms of how they are going to get their supply.” Many quick lube shops get lubricant through major suppliers like ExxonMobil, Shell and Valvoline Inc., Glenn said. It’s possible some automotive service providers are turning to stores like Costco to get cheaper oil, he said.

Costco, which has eight locations on Long Island, sells a two-pack of 5-quart containers of motor oil for just under $58, nearly twice the $30 it charged last year, according to its website.

Competitors like Walmart sell 5-quart containers of its in-house Super Tech brand for between $22 and $33, and AutoZone sells 5 quarts of STP brand synthetic motor oil for $35, according to their websites.

Officials with Costco did not respond to Newsday’s requests for comment.

Industry experts said damage to Middle East refineries that produce the chemicals used in motor oil, combined with the higher prices of crude oil needed to make those chemicals, has created a shortage. The price of Brent crude oil, the global benchmark, is up 49% since the start of the war, according to MarketWatch.

Manufacturers that make motor oil “are having a hard time getting supply," said Holly Alfano, CEO of the Independent Lubricant Manufacturers Association, a national trade group. 

“We’re all competing against each other to purchase the same product,” Alfano said. 

Some Long Island oil change businesses said they've been paying hundreds more for shipments of motor oil this year.

“Being a small-business owner, we can’t do anything about it,” said Amir Abbasi, owner of Dennis Auto Center in Garden City South.

Abbasi said he pays just over $1,000 for a 55-gallon drum of synthetic oil, a $350 to $400 increase over what he paid before the war. As a result, he's had to raise oil change prices. 

“I feel bad for myself and the customers ... but there’s nothing that can be done,” he said.

Chris Daniello, executive director of the Long Island Gasoline Retailers Association, said local business owners who buy oil in bulk are wrestling with high prices, which are often passed along to consumers.

“Unfortunately, they have no choice but to pass that increase onto customers,” Daniello said. “They work on a tight margin.”

As to why Costco might be limiting sales, Daniello said it’s likely the wholesale club is trying to prevent auto businesses from buying up oil meant for average shoppers. 

“Probably the smaller repairs shops are going in and realizing they can buy motor oil cheaper than they can from their regular distributor,” Daniello said. “That’s probably why Costco put a limit."

Costco reported net sales of $297.3 billion for fiscal year 2026, up from $269.9 billion reported last fiscal year, according to recent financial filings.