The Middle East conflict is increasing pressure on the semiconductor industry, tightening key supplies, while analysts remain optimistic about long-term demand.

Helium Shortage Raises Supply Chain Risks

Fitch said disruptions to gas production in Qatar and shipping through the Strait of Hormuz are constraining helium supply, a critical material for chipmaking.

The shortage has led to precautionary buying and pushed companies toward volatile spot markets, raising uncertainty around availability and pricing.

Regional Exposure And Near-Term Stability

The impact varies across Asia, with South Korea the most exposed due to its heavy reliance on Qatar, while Taiwan faces similar risks.

Japan remains less vulnerable thanks to diversified sourcing and inventory buffers. For now, major chipmakers said operations remain stable with sufficient inventory and secured energy supplies.

Long-Term Pressure Meets Strong AI Demand

Fitch warned that prolonged disruptions could strain supply chains, increase costs, and force companies to prioritize higher-value production, even as helium prices could surge sharply in extreme scenarios.

At the same time, Bernstein raised its price forecast on Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM) to about 20% above its current price, maintaining that the company's growth outlook remains strong despite Middle East tensions.

The firm said accelerating AI demand and steady non-AI demand continue to support the business, with demand for key chips still exceeding available capacity.

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