Kurdish forces, known as Peshmerga, took control over two key oil facilities in the north of Iraq. The seizure comes after Iraqi Prime Minister Nouri al-Maliki accused Kurds of being on the wrong side of the fight against a growing Sunni insurgency.
The Iraqi Oil Ministry said Friday the Kurdish force is called on to "support security forces in confronting terrorist groups rather than using the conditions to raid and occupy oil fields."
Already fragile ties between the federal government in Baghdad and the semiautonomous Kurdistan Regional Government have been strained further in the wake of the declaration by the Islamic State of Iraq and Syria of a caliphate in parts of northwestern Iraq.
ISIS militants declared they took over a refinery in northern Iraq last month that processes petroleum products for the domestic market.
Maliki has accused his Kurdish counterparts of harboring militants. Kurdish lawmakers Friday walked out on the federal government.
Tensions in Iraq have yet to curtail the country's oil export potential. While Kurdish oil has made it to the international market, much of the export infrastructure is located in the Shiite south of Iraq.