Public transit will eventually have to move to other energy sources: natural gas (another fossil fuel) and eventually electric. Natural gas is the quicker and more economic choice, of course. Natural gas takes a large tank, and thus is more adaptable for trucks and buses than the family sedan. (There are passenger cars running on natural gas, but the tanks are quite large.)
Eventually, most urban and intercity transportation (other than aviation) will move to electric, possibly on a grid-connection for efficiency. None of this is going to happen in less than two or three decades, of course. The trick is going to be implementing it in an environment where gas prices are rising and supply is dropping. Aviation will have to cut back to the most efficient long distance routes; thus, some form of rail or bus will need to fill the gap from 150 to 600 miles in terms of intercity trip lengths.
Of course, there is that small detail of where the electricity will come from. Coal is the most likely short-term answer, so the fossil fuels will still prevail during our lifetimes, just in different forms.
You're an engineer, right? Then you know that petroleum offers more energy per pound of fuel than any of the other source we have and are like to have in the next hundred years, except possibly nuclear but we refuse to consider that option. By definition, all other forms of driving transit is going to make the cost go up more than the cost of oil.