The second argument is that we'd be better off pursuing alternative energy sources. Here's a newsflash for you - we have. The reason that those sources haven't panned out is because the technological advancements in the petroleum industry kept the cost of oil cheap relative to the costs of the alternative energy sources.
Thirty years ago they said that the worlds oil reserves would be depleted by the turn of the century. Today we have more proven reserves than we did 20 years ago. How? Simple - technology constantly improves on our methods for discovering and extracting oil. Expected developments in extracting oil from shale alone could double proven reserves within the next 10 years.
Twenty years ago experts predicted that solar power would be price competitive with other forms of energy. In a sense they were right - the cost of solar power per killowat hour has dropped dramatically. The second part of their predictions was wrong. In order to predict that solar power would be price competitive, the experts assumed massive increases in the cost of fossil fuels. They were simply wrong - the cost of fossil fuels today are cheaper in real dollars than they were in the 1970s.
As long as oil and other fossil fuels continue to be the most efficient and inexpensive source of fuel we should and will continue to exploit it. When they becomes too costly to extract, we will naturally, and through market forces, develop alternatives. To try and force the market to accept alternatives now when they are not needed will hurt the economy and will ultimately fail.