AhlulBayt News Agency (ABNA): Modern wars are no longer confined to battlefields or oil markets; they have now reached consumers' pockets directly through the devices people hold every day. The smartphone, which appears to be a purely technological product, is in fact dependent on a complex industrial chain that begins in petrochemical plants in the Persian Gulf and ends at electronic chip production lines in Asia. This makes any geopolitical tension in the region a factor in rising technology prices worldwide.
In a report prepared by Nasrine Badour for Al Jazeera, it is explained that the petrochemical industry has become a vital part of the production of smartphones, servers, and AI equipment. These devices depend not only on chips and processors but also on printed circuit boards (PCBs). These boards, which are the mainstay of modern electronics industries, are made using fiberglass, resin materials, and heat-resistant engineering plastics—all of which are derived from crude oil.
This deep connection has turned the Persian Gulf countries into major players in the global technology economy, as they are among the largest producers and exporters of petrochemical products. Saudi Arabia, through its company SABIC, is also one of the world's largest producers of polymers and engineering plastics, producing nearly 50 million metric tons of these materials annually.
Saudi Arabia's importance becomes even greater when we know that it is a producer of a material called polyphenylene ether (PPE) resin—a key material used in the manufacture of advanced PCBs used in smartphones and AI servers.
Al-Jubail: The Heart of the Technology Supply Chain
According to informed sources cited by Reuters, the industrial complexes of Al-Jubail in Saudi Arabia alone produce about 70 percent of the global demand for this critical material, giving the region a strategic position in the global technology supply chain.
These materials are then shipped to major production centers in Asia, particularly China, Taiwan, South Korea, and Japan—countries responsible for manufacturing chips and smart devices. Taiwan alone produces over 90 percent of the world's advanced chips, and this industry is directly dependent on PPE material imported from the Persian Gulf.
But this sensitive supply chain was shocked when Iran's IRGC announced during the 40-day war that it had targeted Saudi Arabia's Al-Jubail petrochemical complex as part of America's interests in the region—an attack that caused a sudden reduction in the supply of primary materials. Goldman Sachs economists have estimated that this shortage increased PCB prices by about 40 percent in just a few weeks.
The Strait of Hormuz Crisis and Disruption of Transportation
The crisis was not limited to factories. Tensions in the Strait of Hormuz further complicated the situation, as maritime transport to and from the Persian Gulf was severely affected, making the transfer of remaining petrochemical stockpiles more risky and costly. This dual disruption—production reduction and threatened sea routes—has now placed severe pressure on the global supply chain.
The technology market research firm TrendForce has warned that the continuation of this crisis could create a widespread wave of inflation in the technology sector. The firm estimates that smartphone and consumer electronics prices may increase by up to 25 percent in the next three months—an increase resulting from the shortage of raw materials and greater reliance on costly air transport to bypass the Strait of Hormuz.
Computers and AI servers are likely to be the hardest hit. The price of these devices is projected to rise by over 30 percent, because heat-resistant insulating materials—a core component of advanced computing systems and data centers—are facing severe shortages.
These developments show how deeply geopolitics and the global digital economy have become intertwined. Military crises in energy-rich regions now directly affect technology industries and consumer markets worldwide. The smartphone that millions use every day is no longer just an electronic device; it is a symbol of the complex global supply chain—a chain that begins with oil and petrochemicals, passes through sensitive sea routes, and ends in chip and smart display manufacturing plants.
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