Corporate media is talking about the disruption of oil supplies due to the blockade of the Strait of Hormuz, but, except for The Telegraph, hasn’t said a word about the disruption to global helium supplies.

The world has lost 40% of its helium supply since the start of the conflict in the Gulf, primarily due to supply disruptions from Qatar and Russia.  The country most reliant on imported helium is China.  Helium is a crucial component in the production of advanced AI chips and semiconductors.

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The world has lost 40% of its helium supply since the start of the conflict in the Gulf.  Qatar, which normally supplies a third of the world’s helium (a by-product of natural gas production at its giant North Field), has not shipped any helium since the Iranian conflict began, and Vladimir Putin’s ban on helium exports outside the Eurasian Economic Union has further exacerbated the shortage.

According to an article published in The Telegraph on Tuesday, the shortage of helium supply is having a significant impact on the global digital economy and various industries that rely on the gas.

Helium is a crucial component in the production of advanced AI chips and semiconductors, as well as other high-priority applications such as nuclear power, advanced weaponry, aerospace, fibre-optic cables, quantum computing, and some laboratory and medical equipment. 

There are no easy substitutes for helium, due to its unique properties, and it cannot be synthesised artificially.

The US is the world’s biggest helium producer, The Telegraph noted, but this does not shield the American people from the larger supply-chain consequences. China is particularly affected due to its heavy reliance on imported helium. “China has strategic stockpiles of everything but not for this one vital input,” The Telegraph said.

Impact on Semiconductor and AI Industries

“Industry cannot make advanced AI chips or semiconductors below 10 nanometres without ultra-high purity helium to cool the wafers and stabilise the plasma for etching. Even workhorse chips for cars and computers require lower-grade helium at 99.999pc purity,” The Telegraph reported.

The United States’ share of global semiconductor output has significantly decreased to 10% from 37% in the 1990s.  Over 75% of the world’s semiconductors are currently manufactured in the Far East, with countries like Taiwan and South Korea relying heavily on Qatar for helium, which is essential for their semiconductor production.

According to Phil Kornbluth, the founder of Kornbluth Helium, companies are scrambling to secure helium supplies to feed the requirements of their AI fabs.

AI fabs, also called AI foundries or AI factories, are specialised computing infrastructure that industrialises the creation, training and deployment of AI models at production scale.

Because AI fabs cost so much to establish, they’re not going to be shut down due to a supply issue. To stay afloat, AI fabs will simply pay more for helium than anyone else, leading to a situation where billionaire technology brothers outbid others to hoard the scarce gas for AI expansion.

The effect of a helium shortage will be far-reaching: the semiconductor industry is hoarding its scarce supply for the most lucrative “AI fabs” while rationing helium for routine “mature-node” chips that play a bigger role in the day-to-day economy.

The shortage of helium is expected to have significant consequences, including a potential repeat of the chip shortage that shut down European car factories during the covid “pandemic.”

Piers Nash, the head of AI at Farmers Insurance, said AI companies reserve what they have for AI accelerators, high-bandwidth memory and advanced logic chips for data centres. There is less left for chips in cars, laptops and the consumer electronics that we all rely on.

And Sepp Müller, a Christian Democratic politician leading a task force on the Iran war in the German Bundestag, warns that the car industry could face big problems in the third and fourth quarters if semiconductor factories are unable to supply more chips.

Read the full article, ‘The next casualty of the Gulf war is already here’ by The Telegraph HERE.

Featured image adapted from ‘Smarter Sensors, Smarter Fabs: How Edge AI is Re-Architecting Semiconductor Manufacturing’, Semi, 2 March 2026