https://arab.news/m73pz
RIYADH: The Middle East plays a crucial role in global supply chains for critical materials, particularly aluminum, sulfur and helium, with the region accounting for about 8 percent of global primary aluminum output, a new analysis showed.
According to the International Energy Agency’s Global Critical Minerals Outlook 2026, the region also supplies roughly one-quarter of the world’s sulfur and hosts trade routes carrying half of global seaborne sulfur shipments, underscoring its strategic importance to industries ranging from fertilizers and semiconductors to aerospace and defense.
The findings come as governments seek to diversify critical mineral supply chains and strengthen resilience against geopolitical disruptions amid growing demand for materials needed for the energy transition and advanced manufacturing.
The IEA described Bahrain’s Aluminum Bahrain, or Alba, as the world’s largest aluminum smelter outside China, while producers in Qatar and the UAE supply key markets across Europe, Asia and North America.
“Exports from the region before the conflict accounted for more than 10 percent of total aluminium supply for the EU, Japan, Korea and Mexico, and just under 20 percent for the US,” the analysis stated.
The report also highlighted the UAE’s production of high-purity aluminum used in aerospace and defense manufacturing.
Separately, the International Aluminium Institute said Gulf producers generated about 6.5 million tonnes of aluminum in 2025, equivalent to roughly 9 percent of global capacity.
The region’s importance to overseas markets is greater than its production share, accounting for about 15 percent of EU aluminum imports and 20 percent of US imports.
The institute has also identified the Gulf Cooperation Council, alongside China, as a major driver of global smelting-capacity growth, supported by newer facilities that tend to be more energy-efficient than older plants.
Sulfur and helium
The IEA said the region holds a similarly important position in sulfur and helium. Sulfur is used to produce sulfuric acid, an essential input for fertilizers and the processing of copper, lithium, cobalt, nickel and rare earths.
Qatar, meanwhile, accounts for about 35 percent of global helium production, making it a leading supplier to semiconductor, fiber-optic, and medical industries.
Investment trends
The IEA’s findings indicate that investment in more resilient production, storage and export infrastructure could reinforce the Middle East’s role as a supplier to high-value global industries.
“Critical mineral investment declined by 9 percent in 2025, ending several years of growth. Amid rising geopolitical tensions and price volatility, investors became more cautious despite strong underlying demand,” the report said.
“Battery metals saw the sharpest pullback, with capital spending falling by more than 20 percent, the largest decline in over a decade, and lithium companies cutting investment by around 40 percent. By contrast, spending by copper-focused companies increased by 8 percent, reflecting confidence in copper's long-term prospects,” it added.
That assessment highlights opportunities for Middle Eastern governments. Countries with established ports, energy infrastructure and industrial production could expand storage capacity and develop emergency reserves for materials that support regional smelters, fertilizer plants and advanced manufacturing.
The report does not present the conflict’s effects as positive. However, its data show that the Middle East already possesses assets that are difficult for global markets to replace.
Protecting and expanding those assets could strengthen regional industrial development while increasing the reliability of international mineral supply chains.
It also noted that stockpiles can protect industrial activity during short-term disruptions and estimated that maintaining reserves of 11 high-risk materials outside the dominant supplier would cost less than $900 million annually.
The disruption also pushed aluminum prices to nearly $3,700 a tonne and lifted the Rotterdam premium by 60 percent between February and April. Although the IEA did not assess the impact on company earnings, the price increase may have supported revenues for producers in the Middle East that remained operational.
The report said restarting idled aluminum smelters can take six to 12 months, highlighting how supply disruptions can continue to affect global markets even after operations resume.