Russia poised to benefit from helium supply shortage during Iran war

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Helium has emerged as a key focus for the technology sector as industry watchers focus on the impact of the protracted Iran war.

Helium, a byproduct of natural gas production, is essential for semiconductor manufacturing, but Iran’s attacks have hampered its ability to export helium, the world’s second-largest supplier.

Qatar, which owns some of the world’s largest gas fields, supplied more than 30% of the market in 2025, according to S&P Global. That’s a big gap to fill.

“Qatar’s helium production shutdown due to the U.S.-Iranian military conflict wiped out about a third of the world’s helium supply, shifting the market from oversupply to shortage,” Deutsche Bank analysts said in a March 12 note.

Prices have soared since then, and many market players are optimistic that chipmakers will be able to maintain access to the material, but a prolonged conflict could leave helium buyers scrambling to maintain supply chains.

North American helium producers, which hold the largest share of the market, are expected to benefit from Qatar’s supply disruption, but Russia, the third-largest helium supplier, could also benefit.

Due to its cooling properties, helium is used in chip manufacturing to transfer heat in many processes.

According to Bernstein’s March 13 memo referring to the Ukraine war, Russia was already ramping up helium production before the Iran war. The reason for this is that they have abundant reserves and “war funds.” That has flooded the unlicensed market with the ingredient, driving down prices, analysts added.

While European and U.S. sanctions and trade restrictions are preventing Russian helium producers from accessing the market, other major chip-producing countries such as China, which produced 33% of mature node chips in 2023, are increasing their dependence on Russia, according to the Semiconductor Industry Association.

According to the Center for Global Energy Policy (CGEP), a research institute, helium exports from Russia to China increased by 60% in 2025 compared to the previous year.

A prolonged disruption to Qatar’s helium exports could create a major rift in the Chinese market, with the Middle Eastern country supplying 54% of the country’s helium last year, according to CGEP.

Russian helium is unlikely to be a preferred solution for Western chip makers due to trade restrictions, but “it could flow into markets such as China and tighten supplies elsewhere,” said Ralf Gubler, research director for industrial gases and fertilizers at S&P Global Energy.

“If the turmoil in Qatar drags on, Russia is in a position to further expand its role in China’s helium supply mix,” CGEP researcher Erica Downs said in a blog post.

While Russian helium is not eligible to supply wafer fabs, the supply could be diverted to other uses, making it eligible for supply to the chip sector, Phil Kornbluth, president of Kornbluth Helium Consulting, told me.

Bernstein cited deepening ties between semiconductor manufacturers and industrial gas companies, company stockpiles, and increased Russian supplies as reasons why semiconductor production is unlikely to be affected by the helium shortage.

But if the conflict drags on, prices are likely to remain high, prompting some helium buyers to diversify their sources.

Geopolitics and trade restrictions, along with supply levels, will undoubtedly limit Russia’s ability to step into the vacuum left by Qatar as it struggles to restart gas production, but the pariah country still has a market willing to do business.

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