Seen at a Roman market that was obviously way over on the "touristy" side of the spectrum. But what a great opportunity to ponder the origins of an interesting word!
What is being referred to here is a small bottle. Or if you prefer, a little flask. Flask is from flasco a Medieval Latin word for bottle. How it snuck into Latin is unclear, it might have been a Germanic word or even a word borrowed by the Germans from the Celts.
Fiasco in the sense of a disaster or an embarrassing mishap is said to be "theater slang" first noted in 1855 and having the meaning of "a failure in performance".
My go to source on such matters is The Online Etymology Dictionary. It tosses out various theories as to the origins of this phrase but has to admit nobody really knows. The best candidate appears to be the Italian phrase "fare il fiasco" which means to play a game in such a way that the loser will have to buy the next bottle.
No particular relevance to our recent trip to Italy. We had the expected minor mishaps but nothing I would call a fiasco. And, to the lasting disappointment of our friend Anthea back in the UK, we never ordered a second bottle of wine.