Iran deals a heavy blow to Qatar's helium exports, causing a global chip manufacturing crisis

Ask AI · Helium shortage to explode in weeks, how will chip manufacturers ensure production?

Iran's military strikes on Qatar's natural gas export facilities are transforming an energy crisis into a systemic threat to the global semiconductor supply chain.

As a source of one-third of the world's helium supply, Qatar's Ras Laffan facility has suffered "massive" damage, causing spot helium prices to double within 14 days, with contract premiums exceeding 30%.

With Qatar's state-owned energy company announcing a 14% reduction in annual helium exports, this crisis has evolved from a projected impact into a real shock—South Korean chip stocks have plummeted. South Korean chip giants Samsung and SK Hynix rely on Qatar for about 65% of their helium imports, and South Korean chip manufacturers have seen over $200 billion evaporate in market value this month. Experts warn: the real shortage impact has yet to arrive, but "it will truly explode in a few weeks."

Qatar facility hit hard, one-third of global supply suddenly disappears

Qatar boasts the world's largest single natural gas field, and its Ras Laffan facility is the largest liquefied natural gas plant globally, where helium is refined as a byproduct of natural gas production, accounting for about 30% of the world's helium supply.

On March 2, an Iranian drone attack forced Qatar's state-owned energy company QatarGas to halt the production of liquefied natural gas and "related products." Four days later, QatarGas declared "force majeure," meaning it could not fulfill contracts with customers.

Last Wednesday and Thursday, Ras Laffan was again attacked by Iran, and QatarGas subsequently reported "massive" damage to the facility, with repairs expected to take years, and annual helium exports set to be reduced by 14%.

According to an article from Wall Street Watch, all three helium production facilities in Qatar have ceased operations, and the American Chemical Society's publication C&EN warns that "if the conflict lasts more than two weeks, the chaos faced by helium users may take months to resolve."

Phil Kornbluth, president of helium consulting firm Kornbluth Helium Consulting, stated:

"This makes the situation worse. The most optimistic scenario is a partial recovery of helium production in six weeks, but given the current situation, that seems extremely unlikely."

Helium spot prices have doubled within 14 days of the crisis's outbreak, and contract premiums currently exceed 30%. Kornbluth predicts prices will continue to rise, "if the shutdown persists, contract prices could surge significantly, there is a lot of room for price increases."

However, Kornbluth also pointed out that the shortage has not truly arrived yet. Helium containers being loaded at the time of the conflict will still take weeks to reach Asia. "No one has cut off supply yet, but in a few weeks, the shortage will truly explode."

Helium: The underestimated lifeblood of chip manufacturing

Helium is perceived by the public merely as an inert gas that makes balloons float, but in semiconductor manufacturing, it is an irreplaceable key material in wafer cooling processes.

During the etching process of chip manufacturing, helium needs to be continuously blown onto the backside of the wafer to quickly and evenly dissipate heat, maintaining a stable surface temperature of the wafer.

Jacob Feldgoise, an analyst at Georgetown University's Center for Security and Emerging Technologies, noted, in this process, "helium is a superb thermal conductor, and chip factories blow helium onto the backside of the wafer to accelerate heat dissipation and maintain cooling consistency."

Jong-hwan Lee, a professor of semiconductor devices at Sungkyunkwan University, clearly stated: under the current semiconductor manufacturing processes, there is no feasible alternative to replace helium for cooling wafers.

The industrial applications of helium also extend to medical and aerospace fields—used in the medical industry to cool superconducting magnets in MRI machines, and in aerospace to clean rocket fuel tanks. As companies like SpaceX and Blue Origin increase their launch frequencies, this demand continues to grow.

Notably, the physical properties of helium make its storage and transportation extremely complex: helium molecules are very small, even the tiniest gaps can cause leaks; liquid helium must be stored in insulated containers, transported through the Strait of Hormuz, and these specialized containers can only preserve helium for 35 to 48 days; after that, helium will vaporize and dissipate through pressure relief valves.

Currently, about 200 of these containers are stranded in the Middle East, each costing around $1 million, and the global supply of backup containers is extremely limited. Kornbluth stated,

"Moving these containers from Qatar to other places that can fill helium will take quite a long time. This initial supply chain restructuring period is likely to be the most severe phase of this shortage."

South Korean chip giants hit hard, market value evaporates by over $200 billion

This crisis has had a particularly direct impact on South Korea's semiconductor industry.

According to an article from Wall Street Watch, data from the Korea Trade Association shows that 64.7% of South Korea's helium imports in 2025 will come from Qatar.

Fitch Ratings noted in a report that South Korea is one of the countries most vulnerable to helium supply shortages globally. Samsung Electronics and SK Hynix— the two largest memory chip manufacturers in the world—are both facing significant supply risks.

The Seoul government has listed helium among the 14 semiconductor supply chain materials that need to be closely monitored due to war. Professor Jong-hwan Lee warns:

"Even if only a few materials are interrupted in supply, it could shake the entire semiconductor manufacturing process because each production phase depends on the previous one."

The market has already begun to react: South Korean chip manufacturers have seen their market value evaporate by over $200 billion this month, as investors digest expectations of a 15% to 20% decline in production by 2026.

According to the article from Wall Street Watch, SK Hynix has maintained a certain inventory of helium and secured additional supply channels, currently distancing itself from the short-term impact. However, medium-term risks remain difficult to eliminate— even if the supply is not completely interrupted, switching to verified alternative suppliers will also take time.

Bloomberg economic analyst Michael Deng noted, "A helium shortage may force chip manufacturers to prioritize the production of more profitable AI chips over other lower-margin components." This means that the consumer chip market will be the first to come under pressure.

Global supply landscape and the limitations of alternatives

Global helium production is highly concentrated.

The United States is the largest producer, with a production volume of 81 million cubic meters last year; Qatar, Algeria, and Russia are other major producers, but Russian supplies have been limited by US and EU sanctions. The US Geological Survey estimates that the US has 8.5 billion cubic meters of recoverable helium reserves, while the rest of the world has 31.3 billion cubic meters.

Although the US and Australia could theoretically provide alternative supplies, the restructuring of the supply chain is not an overnight process. Kornbluth pointed out that about 200 specialized storage and transportation containers are stranded in the Middle East, and reallocating these containers and establishing new supply routes is itself the toughest bottleneck in this crisis.

Experts generally believe that a full-scale helium crisis is unlikely to occur— in the event of a shortage, the helium industry will allocate supplies based on importance, with the semiconductor and medical industries being prioritized for support.

Since helium constitutes a small portion of the total production costs in semiconductors, chip factories "are willing to pay higher prices" to ensure supply. But the premise of this logic is that alternative supplies can be made available in a timely manner.

Bromine: The next potential flashpoint

The article from Wall Street Watch also pointed out that, in addition to helium, another critical semiconductor material, bromine, is also worth monitoring. Bromine is used in semiconductor etching processes, and high-purity hydrogen bromide is widely used in the polysilicon etching segment of DRAM and NAND flash memory manufacturing.

97.5% of South Korea's bromine imports come from Israel, making bromine one of the 14 semiconductor supply chain items with the highest dependency on the Middle East. Currently, bromine is still classified as a potential risk factor and is in a relatively safe zone, but if the situation escalates further, its vulnerabilities will be quickly exposed.