U.S. Unable to Offset Global Helium Shortfall After Russia Imposes Export Controls

A lesser-discussed market that has experienced significant supply tightening as a result of the Iran conflict is helium.

Helium is a critical input for healthcare devices, particularly for cooling MRI scanners, and it is also essential in the production of semiconductors and fiber-optic cables. Although helium is the second-most abundant element in the universe, economically recoverable production on Earth is highly concentrated, and logistical routes have become even more complicated due to the conflict.

The United States, Qatar, and Russia are among the world’s leading helium exporters. Qatar alone accounts for approximately 30% of global helium supply, but due to the Iran conflict and its impact on the Ras Laffan facility in Qatar, production has been halted. In addition, helium exports by tanker have been severely disrupted by instability in the Strait of Hormuz.

This has left the United States, Russia, and to a lesser extent Algeria to help offset the global supply shortfall. Unfortunately, overnight Russia announced temporary export controls on helium in an effort to protect domestic supplies. It is also worth noting that fiber-optic production is critical for drone manufacturing, which is another factor behind Russia’s decision to restrict exports.

Under the new framework, any helium exports outside of the Eurasian Economic Union (EEU)—which includes Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia—will require additional approval from the Russian government. These export controls could remain in place through 2027.

The downstream implications could be significant, particularly for the semiconductor industry and for countries such as Taiwan that rely heavily on helium imports. Unfortunately, even though the United States leads the world in helium production, it may not be able to fully offset the loss of Qatari and Russian helium flows. This imbalance could lead to a rapid increase in prices and potentially create production shortfalls in what has arguably been the market’s hottest structural theme over the past several years: semiconductors and artificial intelligence.

Several major companies have meaningful exposure to the helium supply chain. Exxon Mobil (XOM) operates a large helium facility in LaBarge, Wyoming, which produces approximately 20% of the world’s helium supply. Linde (LIN) also has significant exposure through helium sourcing and refining, along with Air Products and Chemicals Inc (APD).

Depending on the duration of these supply disruptions, costs across electronics, semiconductor manufacturing, and medical devices could begin to rise rapidly. With limited alternative sources able to ramp quickly, the burden falls unevenly on downstream industries that rely heavily on steady helium access.

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