HOUSTON (Reuters) - An enterprising furniture retailer in Houston has come up with a unique way of letting people bet on future oil prices in the world's energy capital.

Jim McIngvale, who owns Gallery Furniture and is known locally as Mattress Mack, is telling customers agreeing to buy $7,000 in furniture that he will give them their money back if oil is $85 a barrel or higher at the end of this year.

Based on current forecasts from major U.S. banks, McIngvale will not have to repay any customers given estimates ranging from $51 per barrel to $75 for the price of crude at year end.

"Everyone knows how important oil is to the Houston area economy," reads an ad on Gallery's web site. "Everyone from construction to retail depends on how well the energy industry prospers. The better energy does, the better we all benefit."

Oil prices have slumped more than 50 percent since June to around $50 per barrel, and many analysts believe global oversupply will keep prices low for months.

Customers making the bet would need prices to rise 70 percent from where they are now to make money in what is described on the web site as a "very limited time offer."

The fourth-largest city in the country, Houston has a long history of booms and busts linked to oil.

Oil is the traditional lifeblood of the Gulf Coast city. Its pro football team used to be "The Oilers."

Local bars include "The Derrick Tavern," a nod to drillers, and "The Refinery," which often puts a sign up on Fridays paying homage to the hydraulic fracturing boom that has lifted U.S. oil output. Its slogan? "Thank Frac It's Friday."

McIngvale, who regularly appears in his store's television advertisements, previously had to pay a total of $4 million to customers who bought his furniture and were guaranteed refunds if the Houston Astros baseball team won 63 games or more last season.

(Reporting By Terry Wade and Anna Driver; editing by Andrew Hay)