2026 Crisis Deepens as Iran War Brings Global Catastrophe

Jakarta, CNBC Indonesia - The memory chip shortage has begun to impact consumer electronics industries such as mobile phones and laptops. Manufacturers are raising prices to consumers because chip prices have risen sharply since late 2025. The chip crisis is attributed to the high demand for chips related to artificial intelligence (AI). AI chips differ from conventional chips for consumer electronics. Manufacturers tend to prioritise AI chip production because it is more profitable, thus sidelining conventional chips. Yet the demand for both remains high. Insufficient supply cannot meet demand, creating shortages and driving up prices. On the other hand, the war initiated by the United States (US) and Israel against Iran has apparently worsened the chip crisis. Policy makers in South Korea warn that the war in the Middle East could disrupt supply of components for semiconductor manufacturing. The South Korean chip industry, which supplies around two-thirds of global memory chips, fears it will be affected by prolonged conflict in the Middle East. The war would trigger price increases and energy costs, said Kim Young-bae, a member of the National Assembly, at a briefing with executives from companies such as Samsung Electronics and trade groups, quoted by Reuters on Friday (6/3/2026). He said the leaders in the tech industry voiced the possibility that semiconductor production could be disrupted if some key materials cannot be obtained from the Middle East. He mentions Helium as an example. Helium is a key component for heat management during the semiconductor manufacturing process. So far, there is no other substitute with a similar function. Helium is produced by a small number of countries, with Qatar being a major player in the industry. Warnings come as chip manufacturers grapple with supply constraints due to surging chip demand from AI data centre operators that has tightened supply to many other industries, including smartphones, laptops, and cars. SK Hynix said it has secured a diversified supply chain and has large helium reserves, so conditions in the Middle East will not impact the company. Samsung declined to comment. TSMC said it has not anticipated significant impacts at this time. The company will continue to monitor the situation. GlobalFoundries, a contract chip maker, has said it has contacted some suppliers directly, customers, and partners in the Middle East. Mitigation plans will also be implemented soon. South Korea’s Ministry of Trade, Industry and Energy says the country relies heavily on the Middle East to supply 14 items in the chip supply chain, including bromine inspection equipment and wood chips, but many of these can be obtained domestically or from other countries. South Korea’s chip industry also warns that this crisis could be a barrier to the plans by big tech firms to build AI data centres in the Middle East in the long term. This would burden chip demand, said Kim, a member of the parliament from the ruling party. Amazon said earlier this week that some of its data centres in the United Arab Emirates and Bahrain were damaged by drone attacks, prompting questions about the pace of expansion by big tech in the region. US tech giants like Microsoft and Nvidia have positioned the UAE as a regional hub for AI computing needed to support services such as ChatGPT.