Low-Energy Fridays: How to Survive the Great Helium Shortage of 2026

It’s no secret that the Iran war is roiling global oil markets. Less well known is how the conflict could affect another critical resource: helium. Qatar supplies around a third of the global helium market, and the war has already disrupted production.

You might be thinking, “What’s the big deal? Less helium might mean fewer balloons at kids’ birthday parties, but that can be managed.” As it turns out, helium also plays an important role in a number of technologies, including the production of microchips. 

Several of its properties make helium extremely useful in chip fabrication, which requires an oxygen-free environment. Even a tiny bit of oxygen or moisture during the fabrication process can fatally damage a chip. Helium has low reactivity, meaning it won’t damage chips during critical periods in the manufacturing process. Its atoms are also small enough that helium can be used to test whether a room is really airtight.

While other gases like argon or nitrogen also have low reactivity, another feature of helium is harder to replicate. Its high level of thermal conductivity (six times higher than nitrogen’s) is particularly effective at dissipating the heat produced during the chip fabrication process. Switching to a less conductive gas would require a much longer cooling period for each chip, thereby lowering a semiconductor plant’s productivity.

Ironically, manufacturers might have been able to look to the federal government for assistance if this crisis had happened several decades ago. In 1925, the federal government established a national helium reserve, which held as much as 1 billion cubic meters of helium gas at an underground storage facility in the Texas panhandle. Like the better-known petroleum reserve, the helium reserve was meant to provide a backstop for helium supplies in the event of an emergency or other shortage.

Helium was mostly used for blimps at that time, and since it wasn’t yet clear that airplanes would eclipse blimps as the predominant form of air travel, creating a reserve had a certain logic to it. The reserve later supplied helium for use as a coolant in rockets.

Over time, the costs of maintaining the reserve—along with the development of more robust private helium production—led to second thoughts about the wisdom of supporting a strategic helium reserve. Congress passed the Helium Privatization Act in 1995, directing the Department of the Interior to sell over the reserve. Unfortunately, sales from the reserve drove down the price of helium to such an extent that it destroyed much of the market for private helium production. Oops.

Private production of helium has since recovered; however, chipmakers and others who rely on helium still face a choice between a number of unpleasant options. They can hope that supply disruptions in the Middle East will be quickly resolved, but if they aren’t, manufacturers would likely reduce their productivity by trying to substitute some other substance for helium. They could find ways to use helium more efficiently or to recycle it—a noble pursuit, though not so easy to achieve. Or they could bid up the price of helium and hope it will induce producers to increase their supply. Firms will likely try some combination of these options.

The Great Helium Shortage may or may not go down in history as one of the major events of 2026, but the market reaction to it is not fundamentally different from the way markets respond to any supply shock for an important resource. As with anything else, the case illustrates how people can adapt to changing economic circumstances, and the need for government to maintain a light touch while allowing those market forces to operate.