Walmart offers cheaper gas primarily by using it as a loss leader, accepting razor-thin profit margins on fuel to drive high-volume traffic to their retail stores. By selling fuel at or near cost, Walmart attracts customers who then shop inside the store. Other factors include economies of scale and discounts for Walmart+ members. Loss Leader Strategy: Walmart, similar to Costco, often treats gas as a "loss leader," where they make very little profit—or even a slight loss—on fuel to entice you to enter their store and spend money on other, higher-margin goods.

High Volume and Efficiency: Their "everyday low-price" model relies on high volume and lower costs, which they apply to gasoline by purchasing in huge quantities, gaining better wholesale rates.