Theo Walcott has found himself as the jilted party in the passion play with Arsenal and two things have become abundantly clear. First, Walcott will not simply roll back the covers and invite Arsenal back now that things are as they once were; he is in a position to make them sweat. Secondly, it is going to cost them – and in much more than purely emotional terms.

The England winger-cum-striker, whose contract expires in the summer, would have signed a long-term extension last August if Arsenal had offered him £90,000 a week. From his point of view the demand was reasonable, particularly when the worth of his image to the club's commercial push in east Asia was factored in. Lukas Podolski, the summer signing from FC Köln, had arrived on £90,000 a week and parity with a player who had no Premier League experience was sought.

Instead the club refused to go higher than £80,000 and, when Walcott did not sign, matters turned ugly. It was suggested to him that, if he did not agree to the terms, he would be moved on before the transfer deadline – Manchester City were the most prominent suitor – and he was then dropped from Arsène Wenger's starting line-up at Stoke City on 26 August.

Although Arsenal met him three days later to back down and say that he would not be sold, Walcott would not start a Premier League fixture until 10 November, against Fulham. Despite the upkeep of his ultra-professional front and nice-guy character around the training ground, the perceived slight cut deep.

Walcott is riding high again as he enters the New Year and eyes a fixture at Southampton, where he emerged as an academy prodigy to cut his teeth in the professional game. He has started, when fit, in all of Arsenal's league fixtures since Fulham and the last three have brought deployment in the central striking role he has long craved, along with four goals and three assists. His hat-trick goal in the 7-3 win over Newcastle United on Saturday was a celebration of slippery pace, persistence and instinctive finishing of the highest order. The Emirates crowd implored Wenger to "sign him up".

Wenger has maintained that he would like to do so but, if he doubted the wisdom of stretching to £90,000 a week in August, he now faces a question to needle him more acutely. Walcott's numbers this season have been remarkable: eight goals in eight league starts, five more in the Capital One Cup and one in the Champions League. Fourteen goals already represents his biggest haul for a season and he is comfortably on target to reach the hallowed figure of 20.

What is 20 goals a season worth, especially when the majority have come from wide areas? More than £90,000 a week. For an element of marketplace context Juan Mata and Ashley Young earn £120,000 at Chelsea and Manchester United respectively.

Arsenal's weekly wage ceiling stands at £100,000 and so they are likely to have to make Walcott their best-paid player to keep him. It is important to note that the money is available, just as it is once more for Wenger to spend on transfer fees in January, if he wishes. And here is the rub for the manager with the degree in economics: is Walcott worth it over the duration of a four- or five-year new contract? At points of last season, he was a lightning rod for the Emirates crowd's frustrations.

The standoff in negotiations has endured. Walcott's people last held official talks with the club three months ago, although the latter party have been increasingly keen to get back around the table and Wenger has had regular chats with Walcott at the training ground. It has not seemed a coincidence that Wenger has finally granted the 23-year-old his wish to start as the focal point of the team's attack.

Walcott's situation has improved since the darkest days of his lost two-and-a-bit months – the evidence that Wenger is willing to use him through the middle has been a fortifying tonic – and the player's representatives are expected to sit down with the club for another round of talks at some point in January, even if nobody foresees a particularly swift conclusion.

Wenger spoke on Saturday of how "the club loves Walcott and he loves the club". "Reciprocity in love," Wenger continued, "is the most difficult thing to find." The new year ought to bring favourable resolution between Arsenal and Walcott but love, ambition and football is a combustible cocktail.