Owen ruptured his cruciate knee ligament in Germany last year and Newcastle are already receiving compensation from the FA of £50,000 a week towards his wages (said to be £105,000 a week).
Blatter (FIFA): "Newcastle have come saying they have to replace him with another player, that this is not fair. We have made a last offer there, and if someone has responsibility then it's the FA towards the player.
"The transfer regulations say players put at the disposal of the national team should be insured by their club. The competition regulations of the World Cup say the national associations must make sure the players are correctly insured.
"We have also set up a special fund for injuries to players for all 32 participants of the competition with a total of 15 million Swiss francs (£7million) available for everybody.
"If you look who is asking for money [from the fund] then something is wrong because it is from the richest league in the world."
An FA spokesman said: "The position remains unchanged. We have been in constructive discussions with Newcastle since the World Cup. We are sympathetic towards their position with reference to the injury and those discussions are ongoing."