The crisis in the Strait of Hormuz, triggered by U.S.-Iran tensions, is unexpectedly dragging the global technology supply chain into an energy shock. This vital waterway, which carries the lifeblood of global oil trade, also serves as a crucial supply route for natural gas that supports worldwide chip manufacturing—a hidden risk that has not yet been fully priced in by the market.

According to a Bloomberg column published on Friday, more than half of the world’s DRAM and NAND flash memory chips are produced in South Korea, while approximately 70% of advanced logic chips are manufactured in Taiwan. Both of these key semiconductor hubs rely heavily on liquefied natural gas (LNG) from Qatar.

On the morning of March 5 local time, Iran’s Islamic Revolutionary Guard Corps issued a statement claiming that a U.S. oil tanker had been struck by missiles in the northern Persian Gulf and was still burning. The statement also warned that military and commercial vessels belonging to the U.S., Israel, European countries, and their supporters are prohibited from passing through the area and will be targeted if detected.

Simultaneously, Qatar’s Ras Laffan LNG plant announced a shutdown on Monday, citing military attacks as a force majeure event and suspending supplies. The facility accounts for roughly one-fifth of global LNG exports.

The news quickly triggered a sharp sell-off in Asian energy-related equities. South Korea’s Kospi index plummeted 12% on Wednesday, its largest single-day drop in history, while Taiwan’s Taiex index fell 4.4% on the same day. The extreme volatility in both markets reflects their unusual vulnerability in the current crisis.

Semiconductor manufacturing hubs are highly dependent on Qatari LNG. The core manufacturing capacity of the global tech industry is heavily concentrated in Northeast Asia. Analysis by Bloomberg columnist David Fickling indicates that over half of global DRAM and NAND memory chips are produced in South Korea, with Samsung Electronics and SK Hynix together accounting for about 40% of the Kospi’s weighting. Around 70% of the world’s advanced logic chips are made in Taiwan, where Taiwan Semiconductor Manufacturing Co. alone makes up 45% of the Taiex index.

These two semiconductor powerhouses are also among the economies most reliant on Qatari LNG. Approximately 90% of LNG produced by Qatar and the United Arab Emirates is exported to Asia. In contrast, while India is the largest buyer of Qatari LNG, natural gas accounts for only about 3% of its power mix. Japan, although a heavy user of LNG for electricity generation, imports only around 5% of its total LNG from Qatar and the UAE.

With reserves running low, April could become a critical turning point. Of greater concern is the extremely limited LNG storage capacity in both regions. South Korea currently has reserves sufficient for less than two months of import demand, meaning that if ships currently en route finish unloading in early April and the Strait of Hormuz remains blocked, power supply will come under immediate pressure. For chip fabrication plants, which consume enormous amounts of electricity, this poses a direct threat to production.

By comparison, the European Union’s LNG reserves can cover about one-third of its annual consumption, providing a much larger buffer than what is available in South Korea and Taiwan.

The South Korean government is now urgently seeking alternative supplies. LNG is still available on the spot market, but at a significant price premium. Australia and the United States, both top global LNG exporters alongside Qatar, typically offer more flexible contract terms and may seize the opportunity to expand spot sales and capture market share.