By utilizing the non-linear ARDL (NARDL) model developed by Shin, et al (2014), we examined the asymmetric effect of oil price and exchange rates pass-through on inflation in Nigeria over a period of 1970 to 2020. Result of asymmetric test revealed the existence of asymmetries among the variables of the study, suggesting that there is a nonlinear interaction among the variables used in the study. This validates the choice of non-linear ARDL model for the study. Result of the long-run estimates show that rising (Positive) oil price shocks have a greater impact on inflation than falling (negative) oil price shock. Furthermore, ot is evident form the result that depreciation of exchange rate has much and significant effect on inflation than the appreciation of exchange rate in Nigeria. However, rising interest rate increases inflation by 0.84 per cent while falling interest rate increases inflation by 0.85 per cent. This implies that the effect of negative interest rate on inflation is higher than its positive effect on inflation, though, by a smaller amount of about 0.01 per cent. Again, the short-run dynamic model revealed a high speed of convergence of more than 90% from the short run disequilibrium. During the study period, the oil price fluctuations showed a significant and incomplete pass-through to both exchange rates and inflation in Nigeria. Based on the findings, the study recommends policies that set oil prices and exchange rate within reasonable limits in order to chack inflation in Nigeria.

The demand for oil in Nigeria has grown significantly during the last four decades with an annual average growth rate of 5.4% from 1973 to 2019. The 1973 and subsequent global oil shocks brought a large influx of petrodollar revenue to Nigeria, which led to an unprecedented rise in individual incomes. The oil-driven revenues also encourage the Nigerian government to move from market-based pricing of petroleum products to a subsidy-based pricing policy. These two factors brought a complete change in individual lifestyles, particularly regarding the choice of means of transportation in Nigeria. Additionally, factors such as population growth, urbanisation boom in construction activities and smuggling of highly subsidised products to energy-deficient neighbouring countries also add to the problem.Accordingly, the vehicle stocks enlarged by more than tenfold within the last four decades; leading to an increase in oil demand in Nigeria. Consequently, oil consumption raised from 16,000 b/d in 1960 to 35,000 b/d in 1980 to 446,000 b/d in 2019 (OPEC, 2020). The problem is compounded by the provision of subsidies on oil products; annually government spends about 4% of GDP on petroleum subsidies. These factors encourage inefficiency and cross-border smuggling. However, the country relies heavily upon the road transport system, with insignificant rail networks and an inefficient air transport system.

This paper employs the linear autoregressive distributed lag (ARDL) model, the asymmetric nonlinear ARDL (NARDL) model developed by Shin, et al (2014) to examine  the asymmetric effect of oil price and exchange rates pass-through on inflation in Nigeria over a period of 1970 to 2020. The result of the asymmetric test revealed the existence of asymmetries among the variables of the study, suggesting that there is a nonlinear interaction among the variables used in the study. This validates the choice of a non-linear ARDL model for the study. Results of the long-run estimates show that rising (Positive) oil price shocks have a greater impact on inflation than falling (negative) oil price shocks. Furthermore, it is evident from the result that the depreciation of the exchange rate has a much and significant effect on inflation than the appreciation of the exchange rate in Nigeria. However, a rising interest rate increases inflation by 0.84 per cent while a falling interest rate increases inflation by 0.85 per cent. This implies that the effect of negative interest rate on inflation is higher than its positive effect on inflation, though, by a smaller amount of about 0.01 per cent. Again, the short-run dynamic model revealed a high speed of convergence of more than 90% from the short-run disequilibrium. During the study period, the oil price fluctuations showed a significant and incomplete pass-through to both exchange rates and inflation in Nigeria. Moreover, the results suggest that positive oil price changes have a larger impact than the negative ones, that the effect of an oil price shock on inflation and exchange rates is larger in the long-run than in the short-run, and that there is incomplete pass-through effect of oil price on domestic inflation and exchange rates. Based on the findings, the study recommends policies that set oil prices and exchange rates within reasonable limits to check inflation in Nigeria and should diversify its economy as well as withdraw the current subsidy regime completely.

Energy consumption is stated to be well-planned as an economy's sustenance and is a substantial contributor to a country's, regions' and continent's overall economic growth. Sustainability implies that economic growth is well-aligned with the socioeconomic and environmental objectives required for long-term development (Díaz et al., 2019). Given the current social and environmental business, energy consumption is a key factor (Ikram et al., 2020). Further, considering the increasing threat of global warming and climate change which are primarily caused by an increase in fossil fuel consumption, therefore, examining energy transition is critical for the world economies, and how energy could be produced and consumed from different sources (York & Bell, 2019). According to Zafar et al. ( 2019) coal, natural gas and petroleum are considered to be the main drivers of economic growth, for a long time; owing to their ability to power industrial operations and transportation while also producing energy (Waheed et al., 2019). Renewable and non-renewable energy resources are used to generate and consume energy by families, businesses and transportation (Vural, 2020).Although African nations account for a modest portion of global energy consumption, the continent is becoming increasingly relevant in global energy markets. Commercial energy consumption in Africa has expanded significantly in recent years, and this trend is anticipated to continue (IEA, 2019). However, there is some special intricacy between African energy consumption and real GDP that makes it attractive for academic study and policy objectives at the country-specific and regional levels. For starters, Africa's energy consumption and real GDP have a significant regional dimension. The percentage of contemporary energy consumption is often larger in the North and Southern African areas than in the other sub-Saharan African regions (West Africa, Eastern Africa and Central Africa). Not surprisingly, it is linked to regional disparities in income and level of development. Second, what is fascinating about energy in Africa,