This study contributes to the classical debate on the causal relationship between competition intensity and product variety by looking at the Greek gasoline market, leveraging the unique geo- graphical characteristics of Greek islands to provide clear market definitions and exogenous variations in competition. Using the total number of gas stations within 3km as a measure of local competition, the paper finds a negative but statistically insignificant relationship between competition and prod- uct variety. Heterogeneity analysis reveals that this negative effect is more pronounced on larger and richer islands, despite the insignificance of results. Robustness checks using alternative mea- sures of competition, alternative measures of product variety, and different methodologies confirm the validity of these results.