Libyan leader Moammar Gadhafi as he addresses the 64th session of the United Nations General Assembly in September. (Richard Drew/Associated Press)

The Libyan ambassador is clarifying remarks by leader Moammar Gadhafi, who appeared to call for an armed holy war against Switzerland last month.

Ali Aujali told Reuters that Gadhafi was referring to an economic boycott when he called for a jihad against Switzerland.

"It is a call for [an] economic and commercial boycott against Switzerland. This is true, but it doesn't mean by any means that it is an armed struggle," Aujali said.

Gadhafi called for a jihad after Switzerland banned building of new mosque minarets. Last week, the Libyan cabinet approved a boycott of Switzerland "because of Switzerland's anti-Islam policy," a government statement said.

It said Libya would seek other suppliers for medicine, medical appliances and electricity equipment.

But the U.S. became embroiled in the diplomatic spat after U.S. State Department spokesman P.J. Crowley responded to Gadhafi's comments.

Crowley said Gadhafi's remarks about jihad reminded him of the Libya leader's speech at the UN in September in which he questioned whether conspiracies were behind the assassination of key political figures in history, including John F. Kennedy and Martin Luther King Jr. in the United States.

"I can recall lots of words and lots of papers flying all over the place, not necessarily a lot of sense," Crowley said last Friday.

This week, Crowley said that his comments were not a personal attack on Gadhafi.

But Aujali told Reuters that Crowley’s clarification is not good enough, and that Libya still demands an apology.

"We are very serious about our relations with the United States based on respect and national interest but ... we will not permit [the] insulting of our citizens, our leader," the ambassador added

With files from The Associated Press