The invisible gas behind the world’s chips

The world’s most advanced semiconductors depend on a gas that cannot be manufactured, is produced in only a handful of places, and is now tied to a region at war. As the war in the Middle East extends into its third week, helium, an invisible byproduct of natural gas, has emerged as a key vulnerability in the global chip supply chain. Roughly a quarter to one-third of global helium supply is produced in Qatar, based on U.S. Geological Survey estimates, placing a critical input for semiconductor manufacturing in the direct path of regional instability.

Helium: A critical but overlooked input

At first glance, the risks posed by the conflict appear concentrated in familiar pressure points: the Strait of Hormuz, rising oil prices, and disruptions to global shipping. About 20 percent of the world’s oil supply passes through the strait each day, along with a significant share of liquefied natural gas exports, according to the U.S. Energy Information Administration. These pressures are already reverberating through energy markets, but their effects extend further.

While helium rarely features in discussions of advanced technology, it is indispensable to semiconductor fabrication. The gas is used to maintain ultra-stable cooling environments for advanced equipment, including extreme ultraviolet lithography systems that print the smallest and most advanced circuits. It also supports plasma etching processes that carve and define those circuits during production and is used for leak detection in highly controlled environments.

Because helium is chemically inert and has uniquely low density and boiling point properties, there are few viable substitutes in semiconductor manufacturing. This leaves an industry already strained by export controls, concentrated manufacturing in East Asia, and rising demand from artificial intelligence and defense sectors highly sensitive to disruption.

A supply defined by natural gas

The fragility of helium supply stems from how it is produced. Helium is not manufactured independently but recovered during natural gas extraction.

Qatar’s role within that system is particularly significant. Global helium output is estimated at roughly 180 to 190 million cubic meters per year, with the United States producing around 80 million and Qatar more than 60 million. Much of that production is concentrated in Ras Laffan Industrial City, the hub of its liquefied natural gas exports, where helium is extracted as part of LNG processing.

This concentration exposes a key vulnerability. Because helium is produced as part of LNG processing, disruptions to gas output, whether due to conflict, infrastructure damage, or shutdowns, immediately constrain supply, with no separate production pathway to offset a slowdown.

From conflict to energy markets

That vulnerability is already materializing. In the early days of the war, Iran struck Qatar’s Ras Laffan, prompting Qatar to suspend LNG shipments to global markets. European natural gas prices rose by roughly 10–20 percent in the days that followed as traders reacted to the loss of Qatari exports and the risk of further disruption.

Two weeks later, the site was struck again, reinforcing the risk that these disruptions may not be temporary. Repeated attacks on a facility that anchors a significant share of global LNG supply, and by extension helium, raise the prospect of sustained volatility rather than a one-off shock. With helium supply constrained, semiconductor output can slow and chip deliveries can be delayed.

At the same time, the war has disrupted the movement of semiconductors themselves. Air freight capacity, critical for transporting high-value electronics, has fallen by roughly 9 percent since the start of the conflict, according to data from DSV, a global freight and logistics company. The result has been rising shipping costs, delivery delays, and reduced import volumes for companies in Europe that depend on chips produced in Asia.

Energy dependence adds another layer of risk. As noted in a recent analysis by the Carnegie Endowment for International Peace, South Korea’s semiconductor industry, a global leader in memory chip production, relies heavily on imported fossil fuels, much of it sourced from the Middle East. A large share of that supply flows from Qatar, which sends more than 80 percent of its LNG exports to Asian markets, including China, India, and South Korea, according to ship-tracking data compiled by Bloomberg.

These fuels power the energy-intensive processes required to produce advanced chips. Disruptions to energy flows through the Gulf therefore do not only affect inputs; they risk constraining the electricity needed to sustain production, threatening the output of some of the most critical chips underpinning AI systems, data centers, and modern electronics.

A hidden bottleneck in a strategic industry

What emerges is a layered dependency that is easy to overlook. Semiconductors are widely understood as strategic assets, central to everything from consumer electronics and automotive manufacturing to artificial intelligence and advanced weapons systems. But the inputs that underpin their production are embedded in a narrower and more fragile supply chain.

The result is a system in which the most advanced technologies remain dependent on a finite resource extracted from a handful of locations and on supply chains increasingly exposed to conflict. As tensions escalate, disruptions in energy, logistics, and supply chains converge, turning even a colourless, odorless gas into a constraint on the technologies that power the modern world.