News:
Since March 2, QatarEnergy has indefinitely halted helium and LNG production at Ras Laffan Industrial City. Even after the war, Qatar said annual helium exports will be reduced by -14% over the next 3-5 years until facilities are repaired.
Trend:
Helium is one of several resources now under pressure due to the war in the Gulf. Qatar accounts for roughly 30% of global output, making this disruption highly consequential.
Helium is a critical industrial gas used in semiconductors, MRI machines, and aerospace, where its inert properties and extremely low boiling point are essential.
As a noble gas, helium does not easily form chemical compounds and cannot be refined like other industrial gases. Instead, it is recovered as a trace component of natural gas processing. In most cases, there are no economical substitutes. While the market has been in surplus in recent years, this disruption will push contract prices higher.
The primary beneficiaries of the shortage are Linde plc (LIN), Air Products and Chemicals (APD), and Air Liquide (AI.PA). These firms generate revenue both from helium production and long-term distribution and supply contracts.
While all three firms source meaningful volumes from Qatar, they are well diversified geographically. The US remains the largest global helium supplier (43%), followed by Russia (9%) and Algeria (6%), providing these companies with alternative supply channels outside the Middle East.
Importantly, these firms also control the logistics, storage, and delivery of helium through long-term contracts with industrial customers. That gives them pricing power. As supply tightens, higher helium prices are passed through into contracts, expanding margins.
ExxonMobil (XOM) also stands to benefit. Its LaBarge facility in Wyoming produces roughly 20% of the global helium supply. But because helium is a small byproduct of its natural gas business, the impact on overall earnings is likely to be limited.
In Practice:
The Hedgeye Fourth Turning ETF is long this trend through Linde plc (LIN) and Air Products and Chemicals (APD). It also owns shares in ExxonMobil (XOM).