1990 oil price shock and prices began to fall. On August 2, 1990, The Republic of Iraq invaded the State of Kuwait, leading to a 7-month occupation of Kuwait and an eventual U.S.-led military intervention. While Iraq officially claimed Kuwait was stealing its oil via slant drilling, its true motives were more complicated and less clear. At the time of the invasion, Iraq owed Kuwait $14 billion of outstanding debt that Kuwait had loaned it during the 1980–1988 Iran–Iraq War. In addition, Iraq felt Kuwait was overproducing oil, lowering prices and hurting Iraqi oil profits in a time of financial stress. In the buildup
Palestinian exodus from Kuwait (1990–91) other sectors continued throughout October. The Iraqis also put pressure on the PLO office in Kuwait, which had refused to organize any Palestinian demonstrations and rallies in support of Iraq. The only Palestinian demonstration in Kuwait during the Iraqi occupation was actually a pro-Kuwait demonstration, with the Palestinian inhabitants of the Hawalli district waving photos of the Emir. Kuwait's lack of support for Palestinians after the Gulf War was a response to the alignment of Palestinian leader Yasser Arafat and the PLO with Saddam Hussein, who had earlier invaded Kuwait. On March 14, 1991, 200,000 Palestinians were still residing in