* Saudi foreign minister says dialogue is only way forward
* Prince Saud warns against protest, foreign interference
* Shi'ites hold new protest in east
* Senior prince questions ban on women driving
(Adds protest, prince remarks on women driving ban, paras 9-14)
By Ulf Laessing
RIYADH, March 9 (Reuters) - Dialogue, not protest, is the best way to bring about change in Saudi Arabia, Foreign Minister Prince Saud al-Faisal said on Wednesday as the country braced for possible protests in the world's top oil exporter.
Inspired by unrest sweeping other Arab states, Shi'ite protesters have taken to the streets in small numbers in eastern Saudi Arabia this month, with further rallies called for Friday.
Prince Saud cautioned that demonstrations would not usher in reform to Saudi Arabia, a bastion of religious conservatism, and said its Muslim clerics had banned protests.
"The principle of dialogue, I believe, is the best way to address the issues facing society," he told a news conference, warning foreign states not to interfere in Saudi affairs.
"Change will come through the citizens of this kingdom and not through foreign fingers, we don't need them," he said. "We will cut any finger that crosses into the kingdom."
Saudi Arabia's huge oil wealth has provided a high standard of living compared to many of its neighbours, and it was widely thought to be immune from spreading unrest, but the rumblings of discontent from the Shi'ite minority have alarmed Riyadh.
"The called-for reform does not come via protests and (the clerics) have forbidden protests since they violate the Koran and the way of the Prophet," Prince Saud said.
Protests by a disgruntled Shi'ite majority in neighbouring Bahrain are being closely watched in Saudi Arabia, where Shi'ites make up about 15 percent of the population.
Saudi Shi'ites staged another small protest in the kingdom's eastern province on Wednesday, witnesses said.
There was a heavy presence of police as over 100 mostly young men gathered in the main Shi'ite city of Qatif on the Gulf coast to demand the release of prisoners they say are held without trial, the witnesses said.
BAN ON WOMEN DRIVING QUESTIONED
Another senior Saudi prince questioned a ban on women driving, and said lifting it would be a quick first step to reduce the Islamic kingdom's dependence on millions of foreign workers.
Prince Alwaleed bin Talal, a nephew of King Abdullah and backer of his careful reforms, told reporters the kingdom could send home some 750,000 foreign drivers if women could drive.
"A lot of Saudi women want to drive their car in line with strict regulations and wearing a headscarf. But now they need a driver ... This is an additional burden on households," he said.
"The Saudi society wants fewer foreign labourers ... so why ... why this hesitation (with women driving cars)? I want answers," said the prince, who is a major global investor.
The U.S. State Department said this week Saudis had the right to protest peacefully. Asked about this, Prince Saud said: "The kingdom absolutely rejects any foreign interference in its internal affairs in any shape or form."
Prince Saud added that the motives driving the unrest buffeting several Arab nations were not necessarily the same.
"Every country is different from the other. I can't link them and say this is a rampant phenomenon," he said.
Prince Saud, who is a nephew of Saudi Arabia's King Abdullah bin Abdul-Aziz, said it was up to regional grouping the Arab League to decide what to do to bring calm to Libya, where there is a violent uprising against its leader, Muammar Gaddafi.
"The options to reach this goal, which is protecting the Libyans and stopping bloodshed, are up to the Arab League," he said. Arab foreign ministers are due to meet on Saturday in Cairo to discuss the Libyan crisis.
Libya's rebel leadership has called on the international community to impose a no-fly zone to ground Gaddafi's warplanes. (For an analysis on Saudi Arabia's stand on planned protests, click on [ID:nLDE7260M3]) (Reporting by Mahmoud Habboush and Andrew Hammond in Dubai; Writing by Crispian Balmer; Editing by Sophie Hares)