The Spain international has been strongly linked with a summer return to his native country.
“The situation is clear, we do not want to sell our best players and that includes Xabi,” Benitez told Liverpool’s official website.
“He had a very good season for us and can be an important player in the future. There is no agreement with Real and we want him to be part of our plans going forward.
“Xabi himself told our club magazine only two weeks ago that he was looking forward to his sixth season as a Liverpool player. Why should he want to leave now?”
Benitez added: “Xabi’s agent came to see me recently to talk about the future. It was a surprise for me and I pointed out to him there were three years left on Xabi’s contract.
“I asked him if the player was happy in Liverpool and he said yes. It was a short meeting.”
