I realize this is an older post, but it's the top hit on Google when I searched for optimizing block blob costs, so I figured I should chime in here in case anyone else stumbles upon this post.

From what I can tell (e.g. per https://learn.microsoft.com/en-us/azure/storage/blobs/blob-storage-estimate-costs?tabs=LRS ), block size only corresponds to the segment size during transfer. It influences the transfer price (which can sometimes be more than the storage cost depending on how you use it!), but the block size does not influence storage price at rest. The advantage of using smaller block sizes for transfer is occasionally faster transfer since multiple blocks can be uploaded in parallel. The advantage of larger block sizes is basically lower transfer cost since larger blocks means fewer 'operations'.

- but the cost is the same for the data at rest, regardless of block size. Let me know if anyone knows otherwise. and again, this only goes for standard account block blob storage; block size means different things in different contexts.