US-Israel war with Iran could disrupt global chipmaking as Middle East supplies of key materials face instability
Seoul: South Korean officials have warned that the US-Israel war with Iran could impact the global semiconductor supply chain if fighting disrupts the flow of critical industrial materials from the Middle East.
South Korea’s semiconductor sector, led by companies like Samsung Electronics and SK Hynix, produces about two-thirds of the world’s memory chips. If the Middle East’s supply of chipmaking materials is disrupted, semiconductor production could slow unless alternative sources are found quickly.
One material at risk is helium, which is essential in chip manufacturing for managing heat, detecting leaks, and maintaining stable temperatures in fabrication equipment. For many of these uses, there is no real substitute. About 38 percent of the world’s helium comes from Qatar, where large extraction facilities are tied to the natural gas industry.
If shipping through key maritime routes is interrupted for an extended period, it could slow the movement of industrial gases and petrochemicals that chipmakers rely on. Disruptions to oil and gas exports from the region have already pushed global energy prices higher, affecting fabrication costs.
Energy costs are a major factor in semiconductor production. Fabrication plants run large clean rooms that need constant electricity and cooling, so chipmakers are sensitive to changes in global energy prices. Industry representatives warned that a prolonged conflict could push energy prices higher, leading to increased semiconductor production costs.
These risks come as semiconductor supply chains are already stretched by growing demand from AI computing. Chip demand from AI data center operators has tightened supply across several electronics sectors, including smartphones, laptops, and automobiles.
For now, major chipmakers usually maintain a mix of suppliers and stockpile specialty gases and chemicals to help weather short-term disruptions. But if instability in the region continues, pressure on supply chains will likely grow.