Yeah, it’s a bit odd.
Log into your picasa account. Select the photo and look at the right hand panel for “Link to this photo”. You want “Embed image” – select the size you want then copy the code.
The trouble is that the code you copy contains lots of stuff not supported here. You need to paste the code into your post and have a look for the bit that starts img src=”. You want everything up to the next ” and nothing else.
For example, look for something like this:
https://lh3.googleusercontent.com/-qJDbHYjMipg/TeC_EOYWH-I/AAAAAAAAULE/m2irmmLq0nk/s800/P527096801e.jpg
You then need to put the IMG tags at either end as normal.
Note: You have to do the above. Just copying the url for an image from picasa doesn’t work as it’s only valid for your current session, so it will break shortly after you use it.