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Mitigating climate change in Nigeria: fuel subsidy removal as a possible policy option

Nigeria is a significant producer of crude oil. Over the years, various governments in Nigeria have been subsidising the pump price of crude oil, mainly arguing that this helps to improve welfare of the country’s citizens. However, this paper argues that this might need to change considering the effects exploration of crude oil has on increasing carbon dioxide emissions. The study aims to document the implications climate change has on Nigeria’s crude oil market (and the economy at large) and conceptualise fuel subsidy removal as a climate change mitigation strategy for Nigeria. It concludes that while fuel subsidy removal policy (in the short term) would have welfare implications, in the long run, the policy would bring about greener growth and enhance sustainable development. It also notes that on the adjustment of consumption patterns, afforestation policies (especially in the rural areas) are required to avoid a rapid switch to tree felling for energy.