What 5 major c-store chains are saying about fuel sales
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While c-stores often highlight updates to the tech, foodservice and product mix inside their stores, gas prices and availability are still the main trip driver for a lot of convenience retailers. C-stores sell about 80% of all the fuel bought in the U.S., according to NACS data.
At the start of the year, GasBuddy predicted that average gas prices will continue to drop from their 2022 highs, averaging out at $3.22 per gallon this year, as compared to $3.33 last year.
While lower prices combined with less volatility are favorable to consumers, they could mean lower margins for operators. Pilot, Murphy USA and CrossAmerica Partners have all cited declining gas sales as a major challenge.
Here’s what some major c-store leaders and owners have said recently about fuel sales.
Murphy USA takes a hit on fuel margin volatility
Murphy USA’s full-year revenue last year dropped by $1.3 billion, or 6%, compared to 2023, according to the c-store retailer’s annual report. Murphy attributed the decrease in revenue mainly to lower average retail fuel sales prices.
This marked the second straight annual revenue decline for Murphy. Between 2022 and 2023, the retailer’s full-year revenue dropped 8.2%, which it also pinned on low retail fuel prices.
“Fuel margin volatility is the single greatest factor in the volatility earnings of the business,” President and CEO Andrew Clyde said during Murphy’s earnings call in February. “That’s one of the things we clearly lay out with our board as we establish our plan, our capital allocation framework for not just the coming year, but the next three to five years.”
Arko sees slight gains in gallons
Arko, parent of c-store retailer GPM Investments, saw its fuel earnings decline by $605.5 million, or 8.1%, during 2024. Same-store fuel contribution was also down over 7% last quarter, the company said during its earnings call in February, caused by a decline in gallons and lower fuel margins.
“Fuel margin volatility is the single greatest factor in the volatility earnings of the business.”
Andrew Clyde
President and CEO
Despite the drops, Arko’s leadership remains optimistic about its fuels’ performance moving forward.
“For fuel, we expect an increase in productivity will more than offset a decline in same-store fuel gallons, resulting in a low single-digit increase in gallons per average store compared to the year-ago period,” CFO Robert Giammatteo said during the company’s earnings call.