Italian Prime Minister Mario Draghi summed up the debate about Russian gas imports: "Do you prefer peace or running air conditioning?" With this question he answered a journalist's question during a press conference in Rome on Wednesday evening.

Of course, Draghi didn't have an answer.

This shows that Italy is also tackling the gas embargo issue.

The country is almost as dependent on Russian imports as Germany, and an estimated 24 million air conditioners are in operation during hot summers.

"If the EU agrees on a gas embargo, then we will be very happy to follow that," said the Prime Minister.

What his government advocates, he left open.

Italy is probably not the only country currently hiding behind Germany's open opposition to a gas embargo.

Christian Schubert

Economic correspondent for Italy and Greece.

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However, Draghi does not want to stand still on the energy sanctions: "We are ready to take further steps in the energy sector with our European partners," said the Prime Minister on Thursday after a meeting with his Dutch counterpart Mark Rutte.

Italy and several other countries have been pleading for a gas price cap for weeks, which Europe could push through due to its market power, but has encountered resistance from German and other governments.

However, Italy would have more leeway with oil imports than with gas.

Only around 10 percent come from Russia.

"Our supplier countries are more diversified, an oil embargo would be easier to enforce than a gas embargo," says Italian economist and energy expert Davide Tabarelli.

Second largest importer of Russian gas

The Italian debate is important for Germany because the Italians are similarly dependent on Russian gas imports and, as the second largest industrial nation in the EU ahead of France, their economic structures would also be severely affected by an embargo.

So far, Italy, as the second largest European importer of Russian gas after Germany, has followed Germany's line on the embargo issue.

Most recently, leading politicians such as Foreign Minister Luigi Di Maio and the head of the governing PD party, Enrico Letta, have advocated a gas embargo.

But Prime Minister Draghi, who heads a fragile coalition from the far right to the far left, has so far deliberately left the question open.

Gas is generally even more important for Italy than for Germany.

This covered 42 percent of its primary energy requirements in 2020, compared to 26 percent in Germany.

Around 40 percent of gas imports came from Russia last year – less than in Germany.

Italy also has three LNG terminals and has commissioned two floating plants;

a pipeline also carries gas from Azerbaijan across the Adriatic Sea to Italy, and the country imports significant amounts of gas from Algeria and Libya.

Next Monday, Draghi will travel to Algiers to explore the possibility of higher imports with President Abdelmadjid Tebboune.

Alternatives are not enough

However, according to energy experts, the alternatives are not sufficient to quickly replace Russian gas.

“If you want the embargo, you have to tell people straight.

It wouldn't work without rationing," says energy expert Tabarelli.

Russian gas imports to Italy of 29 billion cubic meters would have to be replaced, double the amount promised by the United States recently across Europe.

According to his calculations, Algeria and Libya could supply perhaps 5 billion cubic meters more.

A further 3 billion cubic meters could be procured through liquid gas and the pipeline from Azerbaijan.

Its own gas reserves, which Italy hardly uses, could perhaps bring in another billion cubic meters.

But that doesn't even cover half of the gap.

"Companies would also have to close because of the gas shortage," says Tabarelli.

According to his estimates, a gas embargo could shrink gross domestic product by 2 percent this year.

The Italian Ministry of Finance, on the other hand, is more optimistic: A gas embargo would, at best, reduce economic growth by only 0.8 percent this year and by 1.1 percentage points next year, according to a recent study.

In the worst case, growth would be depressed by 2.3 percentage points in 2022 and 1.9 percentage points in the following year.

Italy just lowered its growth estimate for 2022 from 4.7 to 3.1 percent.

Should there be further embargoes after coal, Italy will demand joint financing similar to that of the European Recovery Fund, which was set up in the wake of the pandemic.

The immediate costs of the war plus the investments in defence, ecology and digitization are “not affordable for any national state budget”, said Draghi, “we have to find new instruments and at the same time ensure that the funds are used efficiently and honestly”.

However, local resistance to the Italian energy plans should not be underestimated.

The mayor of the port city of Piombino, in the province of Livorno, has refused to moor a ship for the conversion of LPG to gas on environmental grounds.

A dispute with Energy and Environment Minister Roberto Cingolani has broken out.

The last word does not seem to have been spoken yet.