Let's do some business math:

• A barrel of oil produces about 20 gallons of gasoline and about 24 gallons of other stuff, such as aviation fuel, naptha, diesel and heating oil, plastics, etc.
• US produces about six million barrels of oil a day.
• We use it all and import a lot more, 1.8 million from the middle eastern alone.
• The world consumes 22 billion barrels of oil a year.
• We will rapidly increase that to a run rate of 30 billion.
• Geologists say that that there are around 2.39 trillion barrels of oil in the ground, found and unfound.
• Earthlings will use up more than half, 1,35 trillion barrels, by the year 2050.
• Barrons reports that now, we have only a 23.1 day supply, even though we actually have 5% more oil on hand than our historical average.
• The inventory shortfall is because we are like a Weight Watcher class in a Godiva shop. When we smell black gold, all restraint goes out the window.

You may not know this, but oil, like trees, is renewable. But, it takes a tree five to ten years to renew, while it takes oil maybe a thousand times longer. So, in 45 years we'll use up half the oil on earth, versus tens of thousands of years to replenish it.

There's more bad news. Hubbard's Peak (not my hair style, but a bell curve) states that oil wells increase output for half their lives and then wind down the other half, just like the rest of us. The slowdown starts in four years, making those remaining barrels much harder to get when we need them most.

Armed with this math, here's what you need to do to stay competitive:

• Stop buying fuel intensive transportation. It's not going to get cheaper and the pumps will only break your heart and your bank account.
• Switch from oil based raw materials to alternatives before you competition does. They'll eventually get the idea, but not before you have a good head start.
• Think before you invest that 401k in companies that rely on oil, like plastics manufacturers, technology companies and auto makers. Some of them are going to find really rough times ahead.

Remember, it's no longer just about air quality, or balance of payments to the Middle East, although those are good arguments. It's mostly about more demand than supply continuing to drive up costs.

The good news is that we'll run out of oil when we run out of social security, proving that if we don't save gas AND don't save in our IRAs, there will be nothing to spend and nothing to spend it on.