May be cheaper than you think at the dealer.
AND Factory Fresssshhhh!

Most likely the fuel pump. The top cracks and causes what you describe. Some have gotten by with applying a layer of JB Weld over the fuel pump plastic to cover the crack. Others just replace the part. Do a search for replacing the fuel pump and you will find what you need. Then remove the seats and...

SuperHerman....thank you SO much for the speedy reply. This has driven me nuts, thinking I bought a lemon. I will feel more confident talking to a mechanic. Thank you again! I had that happen in to my 2004 S80 and Volvo had a recall and fixed it for free March 16, 2016. It would be worth checking. ...

Have a good look under the fuel rail for dampness and fuel leaks. You don’t want any fuel leak anywhere,but especially near the hot engine. I’ll put up,a picture where to look.

If someone has recently replaced the fuel pump and hasn't bothered to fit a new o ring to the top of the hold down ring you will get fuel odours. The o ring stretches when old and should be replaced upon re-installation of a new pump.

The smell would happen with a tank that's more than half full.

I had a strong gas smell with my '06 S60. It turned out to be that the fuel line at the gas filter had rusted and was leaking. The filter is just in front of the passenger rear wheel on the under side of the car. It is bigger than a soft drink can. Picture in the link. While my leak was outside, I c...