A nearly all-purpose reaction for a plethora of situations. Similar to "Oh my gosh" or "good grief" or "wow". It is customary for one utterance to be followed by at least an echo or two.
It was a popular expression in the eighties and seems to be making a comeback, just like disco.
David: "I wonder what would happen if I wrote 'extortion' in the memo field of a check."
Jenny: "Haha! Oh, Pat Sajak."
David: "Oh Pat Sajak."
Will: "Ohhhhh Pat Sajak."