Usually if I'm sauteeing some veggies or cooking with olive oil I will use a cheaper bottle, but if I am making a dressing or a dish where the oil really stands out I will go with a bottle from a specialty shop. I am making pesto for the first time and wondering which way I should go.
It doesn't need to be "expensive," but it should be extra virgin olive oil, not just regular olive oil. You don't cook a pesto, so the flavor of the olive oil will definitely stand out. Also, when buying/storing extra virgin olive oil, always go for a dark bottle and store in a cool dark place, as the oil is sensitive to light (just like beer or wine).
The one you already own.
And then you make a small quantity of pesto so to taste it, learn it, understand it. This way you can decide which way you want to go, and choose oil accordingly.
It's not a matter of the price itself, but of the taste that it adds to the pesto, and the taste you want for your: it's your kitchen and your food :-)