Global Supply Chains

Iran has blocked maritime navigation through the Strait of Hormuz since the first week of March, following the attacks it sustained during Operation Epic Fury. This disruption has hindered the movement of nearly 20 million barrels of crude oil per day. It has trapped shipments of liquefied natural gas, accounting for around 20% of global consumption, within the waters of the Arabian Gulf. As a result, international energy markets are experiencing sharp price volatility affecting Brent crude futures and European gas contracts.   At the same time, maritime shipping lines have been compelled to reroute their commercial fleets, forcing them to navigate around the historic Cape of Good Hope route at the southern tip of Africa. This enforced geographic diversion adds approximately 19 days to maritime transit times to and from Asia, generating weekly losses for global supply chains estimated at between $2 billion and $3 billion in additional operating and fuel costs.   This operational disruption directly affects the technological infrastructure of East Asia, where advanced semiconductor fabrication facilities in Taiwan and South Korea require vast, continuous electricity supplies to operate lithography systems around the clock. These critical facilities, which account for approximately 68% of global semiconductor production, rely on imported liquefied natural gas to ensure the stability of their power networks and prevent disruptions.   In parallel, the precision manufacturing processes involved depend on highly specialised raw materials whose primary sources are concentrated in regions currently affected by the crisis. In particular, production lines require ultra-high-purity helium gas, extracted as a by-product from Gulf LNG liquefaction facilities, which represent roughly 35% of global supply, as well as bromine, which Korean factories import at a rate of 97.5% from the Dead Sea coast for chemical etching processes. Accordingly, technology firms are accelerating efforts to assess their exposure to the dual energy and critical chemical input shortages. At the same time, economic stakeholders monitor the crisis's trajectory with heightened caution to safeguard supply chain continuity.   Accordingly, this analysis examines the strategic and operational implications arising from the closure, focusing on three principal dimensions. First, it addresses the disruption of liquefied natural gas supplies and their direct impact on the security of power grids that sustain major Asian semiconductor manufacturing hubs. Second, it examines the sharp interruption in the supply of critical raw materials, particularly specialised gases and petrochemical inputs required for precision manufacturing processes. Finally, it explores the logistical repercussions of the forced rerouting of maritime shipping routes, as well as the strategic measures states are considering to mitigate future geopolitical risks.

December 2025 marked a structural shift in the global technological balance of power, as a state-backed Chinese industrial consortium, coordinated by Huawei, approved the operation of a functional prototype of an extreme ultraviolet (EUV) lithography system at a facility in Shenzhen. This announcement dismantles a core assumption that has dominated geopolitical thinking in Washington, Brussels, and Tokyo over the past decade, namely that the extreme engineering complexity of EUV technology would permanently confine China behind a technological barrier, preventing it from advancing beyond the 7-nanometre threshold in leading-edge semiconductor manufacturing.   Western containment strategies were grounded in a firm conviction that the Dutch firm ASML’s monopoly over highly complex supply chains would guarantee the exclusion of the world’s second-largest economy from producing the advanced semiconductors required for artificial intelligence applications. The new Chinese prototype, however, has invalidated this assumption, not by replicating Western engineering paradigms, but by pursuing an alternative physical and engineering pathway, shaped by imperatives of national sovereignty and enabled by effectively unconstrained state capital.   This prototype, based on laser-driven plasma (LDP) technology, demonstrates that Chinese engineering teams have mastered the core physical principles of optical control at 13.5 nanometres. In doing so, they have moved beyond a phase long framed as one of "scientific impossibility", shifting the contest decisively into a new stage defined by engineering scale-up and operational viability. This development signals the end of an era of unipolar technological dominance. It inaugurates a new phase of dual ecosystems within the semiconductor industry. This transformation will require a comprehensive reassessment of the economic and security assumptions that have governed the sector for decades.

According to a report by the United Nations Food and Agriculture Organization (FAO) on the state of food security and nutrition in the world in 2022, it is estimated that between 702 and 828 million people were affected by hunger in 2021, consisting of 278 million people in Africa, 425 million in Asia, and 56.5 million in Latin America and the Caribbean. The number has grown by about 150 million since the outbreak of Covid-19. The Russia-Ukraine War, involving two of the biggest producers in agriculture and staple cereals globally, is disrupting supply chains and further affecting global grain, fertilizer, and energy prices, leading to shortages and fuelling even higher food price inflation. Additionally, food security is a significant challenge in the Arab region, which is facing rising economic, socio-political, and environmental challenges impacting the food security of its growing population.   Hence, our study has examined the factors that affect food security, and our analysis allowed us to determine the top five factors affecting food security: climate change, conflict, overpopulation, inflation, and scarce resources. The study will analyze each factor separately and their effect on food security globally and in many regions, with a focus on the Arab region. Secondly, the study will analyze factors of food insecurity separately and its impact on four significant countries: Egypt, the United Arab Emirates, the Kingdom of Saudi Arabia, and Jordan.   We found that the factors we examined have mainly negative effects on food security, with the exception of climate change, which will positively affect some regions for the time being, and natural resources, which has some aspects that effect food security positively. Additionally, we found that the factors are interconnected since for example, conflict negatively affects food security, and it could increase food prices, as in the current Russia-Ukraine War. Likewise, the adverse impacts of climate change are expected to raise food prices further and dampen the region’s food demand translating into direct increases in malnutrition levels.   Finally, after reviewing the effects of factors on food security, we elaborated some recommendations in order to deal with the adverse effects.