Published On 11/5/2026
Modern wars are no longer limited to battlefields or oil markets, but rather extend into the pockets of consumers through the devices they carry daily. The smartphone, which appears to be a purely technical product, is in fact linked to a complex industrial chain that begins with petrochemical plants in the Gulf and ends with electronic chip production lines in Asia, making any geopolitical turmoil in the region capable of igniting technology prices globally.
In a report prepared by Nisreen Baddour for Al Jazeera, it is clear how petrochemical industries have become a crucial element in the manufacture of smartphones, servers, and artificial intelligence devices. These devices rely not only on processors and chips, but also on printed circuit boards that constitute the basic structure of modern electronics, which are made using fiberglass, resins, and heat-resistant engineering plastics, all of which are materials derived from crude oil.
This interconnectedness places the Gulf countries at the heart of the global technological economy, as they are among the largest producers and exporters of petrochemicals. Through SABIC, Saudi Arabia stands out as one of the largest manufacturers of polymers and engineering plastics in the world, with a production approaching 50 million metric tons annually.
The Saudi industry is gaining additional importance due to its production of “polyphenylene resin” known as “BPE”, which is a basic material used in the manufacture of high-performance printed circuit boards used in smartphones and artificial intelligence servers.
Factories in Jubail, Saudi Arabia
According to what sources told Reuters, Jubail Saudi factories alone produce about 70% of the global supplies of this sensitive compound, which gives the region strategic weight in global technological supply chains.
These materials are later transported to major manufacturing centers in Asia, especially in China, Taiwan, South Korea and Japan, where electronic chips and smart devices are manufactured. Taiwan alone accounts for more than 90% of the world’s advanced electronic chip production, an industry that directly depends on PPE coming from the Gulf.
But this sensitive chain was subjected to a violent shock after the Iranian Revolutionary Guard announced, on April 7, the targeting of a petrochemical complex in Jubail, Saudi Arabia, which caused a sudden decline in the availability of basic raw materials. According to estimates by experts at Goldman Sachs, this shortage led to a rise in printed circuit board prices by 40% in just a few weeks.
The crisis did not stop at the borders of the factories, as the tension in the Strait of Hormuz increased the complexity of the scene, after the movement of maritime shipping to and from the Gulf was greatly affected, making the transportation of remaining stocks of petrochemical materials more dangerous and expensive. This dual disruption, between a decline in production and a threat to navigation, is beginning to put significant pressure on global supply chains.
Trend Force, which specializes in technology market research, warns that the continuation of the crisis may lead to a widespread inflationary shock in the technology sector. According to its estimates, the prices of smartphones and consumer electronics may rise by up to 25% during the next quarter, as a result of the shortage of basic materials and the increasing reliance on expensive air freight to avoid passing through the Strait of Hormuz.
As for computers and artificial intelligence servers, they may be the most affected, with their prices expected to rise by more than 30% due to the scarcity of heat-resistant insulating materials, which are essential components in the operation of advanced computer systems and data centers.
This scene reveals the extent of the interrelation between geopolitics and the global digital economy, as military crises in energy regions have a direct impact on technological and consumer industries around the world. The smartphone that millions carry every day is no longer just an electronic product, but has become a mirror of complex global supply chains, starting with oil and petrochemicals, passing through sensitive sea lanes, and ending in chip and smart screen factories.
