The ongoing Iran war has introduced significant uncertainty into the supply chains for critical chipmaking materials and the future of AI infrastructure in the Middle East, according to experts cited by CNBC. Helium and bromine, essential for semiconductor manufacturing, are at risk of supply disruption if the conflict persists. Qatar produces over a third of the world's helium, and an extended shutdown of the Strait of Hormuz could remove more than 25% of global helium supply from the market, according to Phil Kornbluth, president of Kornbluth Helium Consulting. Bromine, used in etching processes, is primarily sourced from Israel and Jordan, with around two-thirds of global production coming from these countries. While current supply chain impacts are limited, Ray Wang of SemiAnalysis warned that a prolonged conflict could potentially disrupt chipmakers' manufacturing operations [1].
The Iran war has also raised concerns about the security and viability of data center projects in neighboring Middle Eastern countries. Major tech companies, including Nvidia, Oracle, Microsoft, and OpenAI, have recently announced projects in the region. Iran's retaliatory attacks targeted data centers, causing outages to banking, payments, enterprise, and consumer services during the initial week of the conflict. Patrick J. Murphy of Hilco Global suggested that continued geopolitical risk could shift where future AI infrastructure capacity is built [1].
Meanwhile, in the U.S., hyperscalers such as Google, Anthropic, and Amazon are facing backlash over the perceived impact of their data centers on rising electricity prices. Since 2020, residential electricity prices have increased by more than 36%, from 12.76 cents per kilowatt-hour to 17.44 cents per kilowatt-hour in February 2026, with forecasts predicting prices will reach 19.01 cents per kilowatt-hour by September 2027, according to the U.S. Energy Information Administration (EIA). The EIA noted that retail electricity prices have outpaced inflation since 2022 and are expected to continue rising through 2026 [2].
A report from SemiAnalysis argued that market design and policy decisions, rather than AI infrastructure growth alone, are the primary drivers of these energy price increases. Specifically, the Base Residual Auction mechanism in the PJM Interconnection area, which requires consumers to pay for expected electricity costs two years in advance, was cited as a major factor behind "runaway" prices. U.S. President Donald Trump acknowledged the industry's public relations challenges, stating that data centers "need some PR help" [2].
Communities in regions such as rural Virginia and the Arizona desert, which previously welcomed tech investment, are now pushing back against data centers due to concerns about local power grid strain and rising costs [2].
CONCLUSION
The Iran war has heightened risks for chip supply chains and AI infrastructure in the Middle East, while U.S. data centers face scrutiny over their role in rising electricity prices. Both geopolitical instability and domestic policy mechanisms are shaping the outlook for tech sector expansion. Market participants should closely monitor supply chain developments and regulatory responses as these factors may significantly impact future investment and operational strategies.