(Radio Iowa) – The leader of the Ankeny-based Casey’s convenience store chain says he’s not worried at this point about gas sales despite what is happening with Iran. Casey’s C-E-O Darren Rebelez says this is similar to when Russia invaded Ukraine, and oil prices were impacted and gas costs went up.”Wholesale prices move up, retail prices move up, but tend to move a little bit more slowly. And so margins get a little bit compressed on the front side of that curve,” he says. Rebelez says the gas margin, or the amount they make on each gallon, tends to increase. “When there’s an ultimate inflection point and the costs start to come down, retail prices will come down as well, but also tend to come down more slowly and the margin expands,” he says. “So over the course of the cycle, it historically has ended up being a net positive from a fuel margin standpoint.”

He says that is what they saw the last time a war impacted oil and gas prices. “The history from the most recent event with the Ukraine war, that’s exactly what played out. Margins did get a little bit compressed, but not bad. I mean, the quarter, our quarter in 2022, where we had the first initial shock from the Ukraine war, we printed a 36 cent fuel margin that quarter. Then the subsequent three quarters were all over 40 cents a gallon,”Rebelez says. Rebelez says they are also not worried right now about people cutting back on how much gas they buy. “We really don’t start to see any level of demand destruction until we’re approaching five dollars a gallon at retail,” he says. “And we, as we sit here today, we’re right around three dollars a gallon in our footprint. So we have quite a ways to go before we would be concerned from a volume standpoint.”

Rebelez made his comments on a conference call to discuss their third quarter results. The company reported net income for the quarter was up 49 percent compared to last year at just more than 130 million dollars. Total fuel gross profit for the quarter was up 15 percent with a fuel margin of 41 cents a gallon.