The Prime Minister has refused to speculate on how much petrol will cost under an emissions trading scheme.
The Opposition has rejected the inclusion of petrol in Friday's draft Garnaut Report, saying a carbon tax on fuel will exacerbate already painful prices.
Kevin Rudd has told the ABC Labor will carefully consider the Garnaut report and compensation for families, before releasing an official response by the end of the month.
"Once you bring in a carbon-pollution trading system like this, there are effects through the entire economy.
"Most particularly through the cost of carbon-based energy and of course including petrol.
"That flows through the entire economy and therefore flows through to households.
"One of the matters which we will be canvassing in the Green Paper is how to provide adjustment support for households."
Meanwhile a sobering new analysis of the impact of climate change has found we're likely to be hit by extreme temperatures and drought much harder and more often.
The CSIRO and Bureau of Meteorology report examined rainfall, soil moisture and temperature data and concluded all are likely to continue to worsen.
According to the analysis days of extreme temperature will hit the nation once every one to two years instead of every two decades.
Devastating droughts are forecast twice as often with rainfall decreasing in south-eastern Australia and increasing in the north.
Agriculture minister Tony Burke admits a whole new approach to farming may be necessary.
