Analysis: helium markets in flux as buyers scramble and prices climb

Tightened supply of helium arising from the Middle East conflict has started affecting some production in global technology supply chains, leaving   companies looking elsewhere to secure alternative supplies, Reuters reported this week.

While few companies have yet gone on public record about the sourcing challenge, what is already clear is that for some prices are sharply higher. Phil Kornbluth, President of Kornbluth Helium Consulting, has said that helium spot prices have roughly doubled since the crisis in the Middle East began. Another commentator, Anish Kapadia, CEO of market research firm AKAP Energy, said his early indications were of an initial 50% increase in spot prices – and rising.

Such jumps and uncertainty reflect the early days of disruption to a market that is still in flux and adjusting to shipments being delayed and output being knocked. Mostly it has been hit by state-owned energy giant QatarEnergy confirming that its LNG production has been cut by 17% and helium output by 14% following damage to two trains. For helium, this equates to about 5% of total global supply. There is also the question of how to move the molecule around, if specialist containers are temporarily in the wrong locations.

“If those conditions [supply disruption] persist, the market is ⁠effectively missing about 5.2 million cubic metres of helium per month,” said Aleksandr Romanenko, CEO of market research firm IndexBox, speaking to Reuters.

What have buyer companies said so far about the impact? One that has gone on record is Japan’s Iwatani Corp, which is the leading distributor and importer of helium into Japan.

Iwatani said this week that it has so far maintained stable supply to its customers, including semiconductor manufacturers that need high-grade helium for chipmaking. Iwatani’s smooth supply so far in part reflects how it has diversified helium supply, with helium sourcing from the US as well as stockpiled helium in both Japan and the US.

The price picture

One thing to note when it comes to helium is that it operates very differently from most commodities.

Most helium supply is sold through long-term contracts rather than a transparent spot market, meaning price signals often emerge slowly even as supply tightens. It also means that customers and suppliers are impacted unevenly, depending on the proportion of spot business being needed or getting done.

Buyer companies that are impacted very often have few immediate options beyond slowing output and prioritising critical products, while prolonged shortages could force production cuts and ripple through industries from electronics to automobiles.

Global supply and storage

One variable that does play a part is access to storage facilities to tap stockpiled helium.

This week the French industrial gas major Air Liquide said that the helium shortages it was facing would see it reallocate helium supplies from regions beyond the Middle East.

A spokesperson for the company said it is in close contact with its customers and ⁠is now under way with allocating helium from elsewhere.

Partly the major can do this because it has a large helium storage facility in northwestern Germany to support and smooth out any supply bumps. Helium is stored 1,300 metres underground in a salt reservoir that has capacity for up to a year of helium supply for the major. Current reserves at the facility are not known.

High pricing, good prospects

The other side of the coin when it comes to helium shortages and higher prices is the increased incentive to supply the molecule as it becomes more valuable.

There are, for example, lots of helium exploration companies active in the US today that are either pre-commercial or are busy bringing increased volumes of helium to market. For such companies, an increase in pricing and demand is good news for as long as it lasts.

This week one company that’s active in the space and pushing ahead put out a bullish year-end statement about its activities that also talked about the current market and its implications.

Helix Exploration, which has a London head office but is active in Montana in the US, last month started gas production at its Rudyard project, to become a helium producer for the first time.

Production is currently being processed from three wells – Linda, Weil and Darwin – which are connected to the project’s gathering system and an on-site PSA processing plant.

A fourth well, Inez, is expected to be connected once testing is completed.

Bob Sears, CEO of Helix Exploration, described the start of production as a transitional event for the company as it moves from being an explorer to a revenue-generating business.

At the time of the launch, back in Febuary, the company said it hoped to enter a mix of short- and long-term contracts, but the shift in the market since could prompt a subtle change of tack.

“The strategic importance of [US] helium has never been more apparent,” said Sears in a statement in the company’s full-year report to 30 September 2025, which came out this week.

“Spot prices have doubled in a matter of weeks, and industry analysts have characterised this as ‘Helium Shortage 5.0’ – the fifth major supply crisis in two decades. With global production concentrated among just three suppliers – the US, Qatar, and Russia – the structural vulnerability of the helium supply chain is once again fully exposed.”

Sears won’t be alone among US producers and would-be producers in arguing, as he goes on to, that the company’s position as a North American producer with no dependence on Gulf shipping routes or geopolitically exposed infrastructure is “a material and strategic advantage.”

Sears said the company is now in “active dialogue with customers seeking reliable, secure supply, and we expect this environment to be constructive both for pricing and offtaking negotiations in the near term.”

The precise extent to which companies like Helix Exploration and other smaller producers in North America are able to benefit in the weeks ahead should soon be better understood.