Is it an olive-(oil) branch, or is he just blowing more smoke?

Celebrity chef Mario Batali claims to be whipping up a solution to the traffic nightmare outside his famed West Village Italian joint, Babbo.

The congestion has his neighbors fuming.

“We are working on it,” Batali tweeted yesterday. “Harmony is possible.”

Batali declined to elaborate or provide further comment.

But the corpulent cook-master is facing a kitchen nightmare — and it’s no spicy meatball.

Residents who live near the celebrity hotspot are livid over the limos, liveries and cabs that idle incessantly, belching exhaust outside the Waverly Place restaurant in the evenings.

“It’s incredibly obnoxious. I just detest the whole thing,” said Tony Akin, 55, a high-school teacher who lives next door to the upscale eatery.