There would also be big national security concerns. It's hard to hold, for example, Saudi Arabia accountable for misdeeds when your economy depends on them.

For the record, I think the US should do this gradually. Some of the money could go toward welfare and unemployment benefits for people negatively impacted by job losses or price increases.

Isn't fossil fuel subsidies just a way to spread the cost from those who consume the fuel (directly or indirectly) to those who don't?

No, because the “subsidy” is just that some people feel that taxes on fuel should be higher. Nowhere is the price of fuel less than the cost of extracting and refining it, which it would be if it were a true subsidy.

Sounds like what every Central Bank in the developed world is desperately trying to achieve.

But how would you assess impact on the climate crisis (per se)?