In 1968 the Ba'ath party came to power in Iraq which led to raise of tensions with the Shah of Iran, as Iraq began to be viewed by the West and Iran as a Soviet-aligned rival power in the region, the situation further exacerbated following the British military withdrawal from the gulf, largely due to economic reasons, the next year and the subsequent Anglo-American backing of the Shah to be the "policeman" of the gulf.

Nevertheless, Iraq maintained its forces in Kuwaiti territory on the grounds that Umm Qasr was still in need of defence until the dispute is resolved with Iran.

Iraq viewed the ceding of the islands to it as a concession, to remedy its geographically vulnerable position, in exchange of relinquishing its historical claim on the whole of Kuwait.

Kuwait unsuccessfully tried to neutralise Iraqi hostility through financial support, however Iraq impatient continued to grow.

Kuwait sent another note inviting Iraq to discuss the dispute and warned that the issue would be transferred to the Arab League otherwise.