Luaibi said current world oil prices were acceptable and were not affecting the global economy.

"The concern is there ... but Libya's oil exports are limited and OPEC has surplus capacity, much more than what Libya produces," he told reporters in Baghdad.

Although the stability of global oil prices was difficult to estimate, Luaibi said, he did not expect a big increase in the next two or three weeks as Saudi Arabia is able to pump more oil to put a cap on prices when needed.

"We (OPEC) are careful that prices are stable and do not affect (global) economic growth," he said, after a ceremony at the ministry's oil development and research center.

"Until now, the prices do not constitute a danger to global economic growth ... for us the prices are acceptable."

Luaibi said there had been no talks to date of OPEC holding an extraordinary meeting over the Libya situation. The group's next meeting is scheduled for June.

Iraq aims to export more than 2.2 million barrels per day in March, Luaibi said, adding Iraq is on track with building new export facilities that could boost its export capacity from Basra by more than half of its existing 1.8 million bpd.

"We have a new project to set up a new export system that is expected to be completed before the end of this year to add export capacity that could exceed 50 percent of the current capacity," he said.

February exports were 2.202 million bpd, Iraq's highest since the 2003 US-led invasion, and up from 2.16 million bpd in January.

Meanwhile, Oil prices fell on Thursday. Brent crude futures for April fell $1.63 to $114.72 a barrel at 11:37 a.m. EST (1637 GMT). Prices had rebounded from their intraday low of $113.09 a barrel.

US crude futures for April fell 77 cents to $101.46, after hitting a low of $100.37.

Brent's premium to its US counterpart contracted on Thursday and was below $14 on Thursday after last week's record $16.91.

Brent's price rise amid the recent turmoil in North Africa and the Middle East has been stronger because Europe is more vulnerable to supply disruptions from Libya and the region.

Libyan output has fallen to 700,000-750,000 barrels per day (bpd) as most foreign oil workers had taken flight, according to Shokri Ghanem, the head of Libya's state-owned oil company.

US crude's losses were limited by data showing initial jobless claims in the United States fell more than expected last week and a separate report showing that US 2010 nonfarm productivity was revised upward.

"If not for high oil prices we'd have been cheering all the positive data, like the jobless claims, in the past few days," said Phil Flynn, analyst at PFGBest Research in Chicago.

"And the dollar is being smashed because of the ECB and the likelihood that moves to fight inflation might mean lower demand in Europe and the Brent market."