The director-general of Iraqi Airways had his passport seized by the British high court, which ruled that the airline must declare its assets. He was later allowed to leave Britain.
Abdul-Jabbar said the Kuwaiti government had been escalating the Iraqi Airways row in recent days.
"Our planes that land in Sweden, London and Germany, they are blocking supplying them with food, fuel and water," he said. "We have stopped our flights."
He said that the Iraqi cabinet was considering declaring Iraqi Airways bankrupt. "If we announce the bankruptcy of our airline what will the Kuwaitis get? We can establish another airline company and put an end to this case. With this, the Kuwaitis will get nothing."
Al Jazeera's Zeina Khodr, reporting from Baghdad, said that Iraq had been making reparation payments for some time.
"For years Iraq has had to pay 5 per cent of its oil income into a special UN fund. The government would like the government of Kuwait to write off the debt and forgive the past."