Italy's policy on Libya has shifted against Muammar Gaddafi's regime but the government is still keeping its options open due to close diplomatic and economic ties with its former colony, experts said.

"For historic reasons our country has a series of tools to understand the situation and is keeping an open dialogue with all interlocutors," said Andrea Margelletti, director of the Centre for International Studies in Rome.

At stake are billions of euros that Italy has invested in the Libyan economy, its status as Libya's top trade partner and the position of Italian energy major ENI as the biggest foreign energy producer in Libya.

The terms of a wide-ranging friendship treaty signed between the two nations in 2008 as well as major Libyan investments in Italian businesses also go some way toward explaining Rome's initial reluctance to criticise Gaddafi.

As the first protests against the regime broke out last month, Prime Minister Silvio Berlusconi said he had not spoken to Gaddafi because he did not want to "disturb" him and he was then late in condemning the violence.

But as the clashes escalated in recent days, Italy's position hardened and is now broadly in line with the rest of the international community.

Italy "has hardened against Gaddafi's regime along with other international players," said Ettore Greco, head of the Institute for International Affairs.

"Italy is now in line with the positions of the United Nations, the European Union and NATO... while before there was a certain reluctance," Greco said.

Foreign Minister Franco Frattini has said Italy is prepared to allow other countries to use its air bases if there is a UN Security Council decision to enforce a no-fly zone over Libya and is proposing a naval blockade.

But at the same time, Greco said Italy wants to "safeguard" the terms of its 2008 treaty with Libya which grants major economic advantages to Italy and commits Libya to preventing illegal immigration from its shores to Italy.

The treaty, which Frattini earlier described as "de facto suspended" because of the absence of interlocutors on the Libyan side, also stipulates that Italian air bases cannot be used to attack Libyan territory.

Libya insisted on the clause at the time saying it wanted to prevent bombardments like the one in April 1986 that killed Gaddafi's adopted daughter in which US planes were directed by a radar located in Italy.

"As often happens with Italian foreign policy, Rome is not taking a clear position," said an article in Italian geopolitics journal Limes.

"It is leaving the decision up to others as it waits for roles to become defined and will then seek an intermediary position," it added.

Margelletti defended Italy's "moderate" position saying: "I think the government is doing well to stay in line with other countries."

Italy ruled Libya between 1911 and 1942 -- a traumatic period in which Italian forces crushed resistance but also developed infrastructure.

Many Italians stayed on but were later expelled after Gaddafi came to power in 1969 and Libya now usually has around 1,500 Italian residents.

"With its presence and historic ties there is potential for a former colonial power to have a bigger influence," Greco said.

"But there is also the disadvantage of being seen as a former colonial ruler and therefore be more exposed to accusations of interference," he added.

Limes pointed out that Italy was vulnerable to a missile attack from Libya and to migratory flows from Libyan shores if controls were lifted.

The journal added: "Never before has Italy's geopolitical position given it such a potentially fundamental role in the Libyan crisis."