The International Monetary Fund (IMF) sees no immediate threat to the global economy from either the recent oil price surge or insecurity in Iraq.
"It [the oil price] is one of those things that we see as something to keep an eye on rather than something that we think is definitely in the danger area," Ms Anne Krueger said after addressing a World Trade Organisation meeting today.
On Iraq, she replied "I don't think so" when asked whether the violence and instability in the country had become a factor threatening to undermine global economic confidence.
US stock prices hit their lowest levels this year yesterday after the killing of the head of the Iraqi Governing Council helped push US oil futures prices to their highest in 21 years of New York trading.
"As of this time, we are looking at one potential source of difficulty but the real price of oil is in the range where it has been before," Ms Krueger said.
Oil prices slowed today as some players took profits. US light crude was down 35 cents a barrel at $41.20, off yesterday's intraday peak of $41.85.
Allowing for inflation, however, oil prices are about half those during the oil price shock that followed the 1979 Iranian revolution. Adjusted for inflation at 2002 prices, crude's historic peak was a $78-a-barrel average in 1980, according to BP.
Ms Krueger reaffirmed the IMF view that the world economy was heading for a "soft landing" as global interest rates begin to rise from historic lows because this was just a natural response to a growing demand for funds.