It's not hard to determine the "real gas price":
That shows the average wholesale price of unleaded gasoline. Note that it is BEFORE blending with alcohol and before any gasoline taxes.
Kroger may be losing money on this one transaction -- it depends on whether they are paying full price for the gift cards or the merchants are selling them gift cards at a discount. But, if they are indeed losing money, it is what is called a "loss leader".
Merchants are willing to take a loss on selected items in order to get you in the door. The expectation is that you will buy other things, and that profit will make up the loss.
It's a psychological marketing game.... just like why they put milk at the back of the store, and candy and magazines at the checkout register.
They actually increased their gift cards to 4x points before Christmas. $250 in gift cards buys you 1,000 points or $1 off per gallon. Gas was around $2/gallon when they did that. I can’t imagine that they would open themselves up to that kind of a loss knowing that everybody and their brother would be maxing out their discounts for Christmas between gift cards and groceries. They have to be at least close to breaking even.