The 33-year-old will lead Team Sky's challenge in the opening Grand Tour of the season, which gets underway on Saturday.
Wiggins admitted that he may find it difficult to match the Italian on the steep ascents throughout the Giro, but has targeted big performances in the time trials in order to add the maglia rose to his yellow jersey.
"[Nibali] is the man to beat, for me," Sky Sports News quotes Wiggins as saying. "I think he is in better shape than he has ever been in, definitely.
"I still don't know at this stage whether I will stay with Nibali on some of those real tough finishes, the real steep ones, but I know that I am not going to lose a handful of time.
"I may lose a couple of seconds here and there - at most on some of those real tough finishes I may lose 20 seconds, if I am on a bad day. But that is all I have to do really, because I am confident that in the time trials that are there, of what I have seen, I can take time on him."
Wiggins won gold in the individual time trial at the London 2012 Olympics.