Ba'athist Iraq reducing international oil prices, further weakened the Iraqi economy. In response to this, Saddam threatened Kuwait that, unless it reduced its oil output, Iraq would invade. Negotiations broke down, and on 2 August 1990, Iraq launched an invasion of Kuwait. The resulting international response led to the Persian Gulf War, which Iraq lost. The United Nations (UN) initiated economic sanctions in the war's aftermath to weaken the Ba'athist Iraqi regime. The country's economic conditions worsened during the 1990s, and at the turn of the 21st century, Iraq's economy started to grow again as several states ignored the UN's sanctions. In
Invasion of Kuwait US embassy in Iraq, following on from Ms Glaspie's meeting with Saddam Hussein. In addition, one week before the invasion, the Assistant Secretary of State, John Kelly, told the US congress that the US had no treaty obligations to defend Kuwait. According to Richard E. Rubenstein, Glaspie was later asked by British journalists why she had said that, her response was "we didn't think he would go that far" meaning invade and annex the whole country. Although no follow-up question was asked, it can be inferred that what the U.S. government thought in July 1990 was that Saddam Hussein was