With President Donald Trump still reviewing the US position, "the question of the Paris climate accord is still hanging," Prime Minister Paolo Gentiloni told a news conference.
Gentiloni had gone into the summit acknowledging deep divisions but hoping for some degree of convergence on a way forward.
Trump campaigned on a pledge to ditch the United States commitment to applying the 2015 Paris deal, which seeks to curb global warming by cutting carbon emissions.
The stalemate on climate change was mirrored by divisions between the US and the other six G7 countries over trade and migration at the annual summit, described by officials as the toughest in years.
The meeting is due to conclude on Saturday with a final statement which Italian officials have indicated will be a fifth of the originally planned length -- if it can be agreed at all.
Officials were due to work through the night in an attempt to reach a compromise on the text.
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