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
Iran–Kuwait relations Arabia, Bahrain and the UAE voiced strong support for the withdrawal, which Kuwait did not join. Kuwait's plans for regional development, including the "Silk City project" that aims to develop the Kuwaiti Islands, includes developing mutually beneficial economic ties with Iran. Iran–Kuwait relations Kuwait has close and friendly relations with Iran. Kuwait describes its relations with Iran as "excellent and historical". Kuwait sided with Iraq in the 1980-88 Iran-Iraq War. According to a declassified 1987 CIA document, Kuwait and Iran were on a "collision course". The document attributes deteriorating relations between the two countries to an increase in Iranian attacks