The Strait of Hormuz is once again asserting its influence over global prices. Brent crude rose 3.83% on Aug. 6 to settle at $82.49 a barrel after reports that Iran’s parliament was considering legislation restricting passage for U.S. and Israeli vessels. With roughly 20% of global oil and liquefied natural gas flows passing through the strait, any disruption can push up both energy prices and maritime transport costs.
South Korea cannot view the situation simply as another fluctuation in international oil prices. The country sources about 70% of its crude oil from the Middle East, with most of those supplies passing through Hormuz. Instability in the strait can therefore raise costs across Korea’s AI industry through electricity, logistics and semiconductor materials, extending far beyond refining and petrochemicals.
According to the International Energy Agency, nearly 20 million barrels of oil per day passed through the Strait of Hormuz in 2025, with about 80% destined for Asia. More than 110 billion cubic meters of LNG also transited the strait that year, and there are effectively no alternative routes capable of replacing those volumes.
Semiconductor Costs Begin with Electricity and Materials
Electricity is one of the first channels through which the semiconductor industry feels the impact. Advanced chip fabrication plants consume vast amounts of power for wafer processing, extreme ultraviolet lithography, process-gas management, ultrapure water production and cleanroom operations. When LNG prices and domestic power-generation costs rise, the burden can feed directly into industrial electricity expenses and semiconductor production costs.
AI data centers face the same pressure. As demand for AI computing accelerates, access to reliable electricity is becoming a central measure of national competitiveness. Yet South Korea remains heavily dependent on imported energy, leaving both AI chip production and data center operations exposed when higher oil and LNG prices raise power costs.
A scenario analysis released by the Korea Institute for Industrial Economics and Trade in March warned that an energy price shock could spread throughout Korean manufacturing. It estimated that manufacturing costs could rise 5.4% under a short-term supply disruption and as much as 11.8% under a prolonged shock. The impact would begin in refining and electricity before spreading to energy-intensive industries such as chemicals, metals and transportation.
Hyunji Bing, a researcher at KIET who authored the report, later argued that transit, insurance, freight and sanctions risks should be treated not as temporary factors but as structural security costs. She said those costs should be incorporated into corporate systems for contracts, insurance and trade finance.
The key issue is that not every cost returns to its previous level when oil prices stabilize. War-risk insurance premiums, shipping rates, route-diversion expenses and inventory costs may remain elevated long after geopolitical tensions ease. Hormuz risk is therefore more than a temporary energy price shock: it can add a new “geopolitical premium” to Korea’s manufacturing cost base.
Helium Exposes a Hidden Weakness in Korea’s Chip Supply Chain
A second source of pressure lies in the critical materials required for semiconductor production. One of the most important is helium, which is used for wafer cooling, temperature control and leak detection. Finding an effective substitute is difficult.
Qatar accounts for roughly one-third of the global helium supply. Because helium is recovered as a byproduct of LNG production, disruptions to Qatar’s gas operations and exports can also reduce helium availability. Korean chipmakers have sought alternative supplies from countries including the United States, but these measures have mitigated immediate disruption at additional cost rather than eliminating the underlying risk.
Kim Young-bae, a lawmaker from South Korea’s Democratic Party, said after a March meeting with representatives from Samsung Electronics, SK hynix and industry groups that participants had raised the possibility of semiconductor production disruptions if certain critical materials could no longer be sourced from the Middle East. The Ministry of Trade, Industry and Energy subsequently reviewed 14 semiconductor-related materials with significant exposure to the region, including helium.
Inventories may help Korean chipmakers postpone immediate production problems, but they do not remove the supply-chain risk. Buyers without long-term contracts may face higher spot prices and transportation expenses during a shortage. Those additional costs ultimately enter the semiconductor production chain.
Hormuz risk is also increasing maritime logistics costs. KIET estimated that a rise of just 0.4 percentage points in war-risk insurance rates could add approximately $400,000 to a single voyage by a vessel valued at $100 million. Route diversions, shipping delays and larger safety inventories would put further cost pressure on Korea’s export-oriented chip industry in both production and transportation.
Global investment in AI infrastructure, meanwhile, continues to expand. South Korea’s semiconductor exports increased 179% year on year in July, supported by AI infrastructure spending and higher memory-chip prices. Sustaining that growth will require more than robust market demand; it will also depend on reliable access to electricity, materials and logistics.
Korea’s AI strategy has largely focused on semiconductor capacity, data center construction, talent and model development. The Hormuz crisis shows that competitiveness is also determined by the ability to secure energy and industrial materials. Even when AI chips are manufactured domestically, the supply chain cannot be considered fully secure if electricity, helium and logistics remain highly exposed to external geopolitical events.
Korea should therefore look beyond petroleum reserves when assessing energy security. Long-term LNG contracts and diversified import sources, strategic reserves of semiconductor process gases, helium recovery and recycling technologies, and reliable electricity from renewables and nuclear power should be integrated into a broader AI industrial strategy.
The Strait of Hormuz may be a narrow waterway in the Middle East, but the risk premium formed there can reach the electricity bills of Korean semiconductor factories and the operating costs of AI data centers. National competitiveness in the AI era will not be secured by the ability to design advanced chips alone. It will also depend on the energy, materials and logistics infrastructure required to produce and operate them without disruption.
Sources: International Energy Agency, Korea Institute for Industrial Economics and Trade, Reuters, Ministry of Trade, Industry and Energy
