IF YOU HAVE BEEN FOLLOWING the news about oil prices, you are probably totally confused or seriously misinformed. The situation is both much better and far worse than you have been led to believe.

Start with the better. When prices hit $40 per barrel, motorists were upset. Or so we are told. But Americans keep buying gas-guzzling SUVs, and filling their tanks with gasoline that costs over $2 per gallon. So talk of high prices causing consumers to sulk on their couches rather than drive away to visit granny this summer, or take a spin down to the mall, seem overblown, especially as the economy gathers steam, the jobs market improves, and incomes rise.

There is good reason for this lack of reaction. Gas prices may seem high compared with a few months ago, but look back several years, and compare like with like. The Dallas Fed estimates that if we adjust for inflation, crude prices would have to rise to $75-$80 per barrel to get where we were in 1981, and gasoline prices would have to rise to $3.50 per gallon. So oil and gasoline prices are not devastatingly high by historical standards.

Two other facts have to be entered on the "better" side of the ledger. The first is that the drain of high oil prices on the U.S. economy is not as great as press reports suggest. Almost half of America's oil comes from domestic fields, meaning that a significant part of the higher price is paid by American motorists to American oil companies and their American shareholders and employees. And part of the rest is recycled to the Unites States when the Saudis drop by to denude Fifth and Madison Avenues and Rodeo Drive of their luxury goods, Arab students pay full tuition in American universities, and Arab dictators and royals purchase 747s for their personal use and fighter planes to keep their militaries non-mutinous.

The final bit of good news relates to the impact of higher oil prices. Various government and private forecasters say that $40 oil will cut about 0.5 percent off U.S. and world GDP growth. Which brings to mind the old joke: "Economists use decimal places to prove they have a sense of humor." GDP estimates are enormously crude, and often subject to major revision. Forecasts of GDP are even chancier. For forecasters to believe that they can translate a given increase in oil prices into a one-half-of-one-percent change in GDP growth is hubris of a sort not seen since Nikita Khrushchev predicted that the growing Soviet economy would bury America's in a few short years.

Besides, even if these analysts have crystal balls of unusual quality, the American economy might grow this year at a rate of, say, 4.5 percent rather than 5 percent, hardly something that would keep the crew working on the president's reelection campaign awake at night. And, as Larry Lindsey, formerly head of the White House economic team reminded me, the 0.5 percent "hit" from higher oil prices would be a one-time affair, after which growth would resume, although from a slightly lower base.