Germany were pushed all the way by The Fennec Foxes with both teams deadlocked at 0-0 after 90 minutes.
"We didn't play well in the first half, but matches of this kind exist," explained Low.
"In the other matches as well, Brazil had to convert a penalty to reach the next round. Matches of this kind will always exist.
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"We started the second half differently and dominated in extra time. The efficiency of goal scoring still must be improved."
On a night where Algeria aimed to exploit Germany's high-line defence, goalkeeper Manuel Neuer had to repeatedly come off his line to thwart the up-tempo Algerian attack -- something Low was quick to praise.
"[Neuer] played an extraordinary game because he didn't have to make big saves," said Low. "But he saved us very often and ran out of the goal on Algeria's long passes against their fast attackers."
The three-time champions did eventually scrape through thanks to goals from Andre Schurrle and Mesut Ozil, setting up an epic World Cup quarterfinal meeting with continental neighbours France.
"France vs. Germany has always been a very dramatic and tense match," said Low. "It is always a classic."