When gasoline prices surge, Americans don’t stop eating out. They stop eating out expensively.
That is the central finding of a Bank of America research note published Monday by analyst Sara Senatore, who tracked BAC aggregated credit and debit card data across every major fuel price cycle since 2005.
Her conclusion: spending on gasoline increases almost as fast as the gas price itself, meaning consumers keep driving and absorb the cost, then quietly reallocate what’s left.
Discretionary categories take the hit. Casual dining contracts. Airlines slow. Auto spending falls to less than half its long-run rate.
But one category breaks the pattern every single time: quick-service restaurants, with pizza chains leading the acceleration.
Gas Demand Is Inelastic, Your Wallet Isn’t
The first and most important finding is structural. When gas prices rise, consumers do not meaningfully cut back on how much they drive.
Bank of America card data shows that gasoline spending grows almost as fast as the gas price itself — meaning that quantity adjustments are small even during periods when prices surge sharply.
The pump gets paid. Everything else gets squeezed.
That squeeze is not evenly distributed. According to Senatore’s analysis, discretionary spending growth slows to an annualized rate of 2.9% during high-gas-price periods, against a long-term compound annual growth rate of 3.6%.
Non-gas necessities such as groceries and utilities slow more modestly, to 2.7% against a 3.1% CAGR. The largest single-category slowdown is auto-related spending, which decelerates to 0.9% against a 2.4% baseline.
Restaurants as a broad category slow too — from 5.3% to 4.5%. But within restaurants, the numbers diverge sharply.
The Trade-Down That Runs To The Drive-Through
Casual dining contracts to an annualized −1.1% during gas spikes. Fast casual slows to 4.0% from a 5.6% baseline.
Meanwhile, QSR — quickservice restaurants, or fast food — accelerates to 7.3% from a long-term rate of 5.1%. Pizza chains lead the move at 7.8%.
“QSR spend growth also accelerates when gas spend rises (7.28% vs 5.12% CAGR), signaling efforts to economize by trading down to QSRs (pizza and non-pizza),” Senatore said.
The mechanism, according to Senatore, is a share-of-stomach shift. The rate of grocery spending growth appears to be modestly higher during periods of rising gas prices, suggesting that consumers substitute food at home for food away from home.
But the larger move is a rotation within dining itself — and growth in spending on chains slows less than on independents, meaning the consumer trading down gravitates toward recognizable brands.
Income amplifies the effect. Households earning under $20,000 per year slow discretionary spending to just 0.71% — well below their 4.49% long-term trend.
Those are the core demographic for QSR chains. When lower-income consumers feel the gas pinch hardest, they lean hardest on value menus.
Where the Money Goes During a Gas Spike
| Category | Spend During Spike | Long-Term CAGR | Gap |
|---|---|---|---|
| Discretionary (all) | 2.90% | 3.63% | −0.73pp |
| Non-Gas Necessities | 2.71% | 3.08% | −0.37pp |
| Auto-Related | 0.88% | 2.41% | −1.53pp |
| Airlines | 2.46% | 2.23% | +0.23pp |
| Lodging | 1.35% | 1.89% | −0.54pp |
| Grocery | 2.25% | 2.12% | +0.13pp |
| Restaurants (all) | 4.46% | 5.26% | −0.80pp |
| Casual Dining | −1.11% | −0.37% | −0.74pp |
| Quick Service Restaurants | 7.28% | 5.12% | +2.16pp ↑ |
| Pizza (QSR) | 7.78% | 5.12% | +2.66pp ↑ |
| Fast Casual | 3.99% | 5.64% | −1.65pp |
| Restaurant Chains | 2.33% | 3.25% | −0.92pp |
| Independent Restaurants | 2.57% | 4.93% | −2.36pp |
The Stocks That May Benefit From The Trade Down
The BofA report did not name specific companies, but the category breakdown maps directly onto the major pizza and QSR names in the U.S. equity market. Pizza QSR is the single strongest-performing segment in the data — 2.7 percentage points above its long-term trend — which positions pure-play delivery chains as the most direct beneficiary.
Domino’s Pizza Inc. (NASDAQ:DPZ) is the clearest expression of the trade.
The company operates almost entirely within the pizza delivery and carry-out format that the BofA data identifies as the outperforming segment, and its first-quarter 2026 earnings due April 27 will be the first report to capture the March gas price spike.
McDonald’s Corp. (NYSE:MCD) offers the broadest QSR exposure, with value menu positioning that historically drives traffic gains when household budgets compress.
Yum! Brands Inc. (NYSE:YUM) captures the trade through Pizza Hut’s delivery network alongside Taco Bell, whose low average check makes it a natural destination for consumers trimming dining spend.
Papa John’s International Inc. (NASDAQ:PZZA) is the most leveraged pure-play pizza name, though its smaller scale and recent franchise challenges add execution risk alongside the category tailwind.
The Timing Caveat
To date, high-frequency card data show no signs of restaurant spending slowing. Year-over-year restaurant growth decelerated from 3.6% in February to 1.3% in March, but the two-year stacked rate improved to 1.4%.
“The recency of the gas spike suggests that consumers may be waiting to determine whether the increase in gas prices is transitory. The ~6-month average duration of prior trough to peak cycles suggests that consumers adapt only when price increases persist,” Senatore said.
The QSR trade is not priced for a cycle that hasn’t yet arrived at the consumer’s decision point.
With gas above $4 and the Hormuz disruption showing no signs of resolution, history says the rotation is coming. It just hasn’t shown up in the data yet.
Image via PPandV/Shutterstock
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