"If oil continues to skyrocket, cost of production will increase significantly since current ore from the Barry deposit is trucked at considerable expense."
Cost of production at Barry is $330 so that is very very good!
I think if oil continues to skyrocket it will push the POG much higher. There is already a big shortage of gold worldwide. So if cost of production increases the POG will have to move up. Why ? Here is why:
If cost of production gets too high, big producers like Barrick or Goldcorp will simply cut the production, and many juniors will go out of business. There will be less gold discoveries as there will be very little juniors left. That will cause even more shortage of gold what in turn will force the POG higher. So OIL and Gold is kind of intertwined. Of course it is much better for the economy and everyone (except for oil companies) if oil stays low