Iran War Threatens U.S. Datacenters
War in the Middle East could seriously hamper AI buildouts back in the U.S. As the prices of oil and natural gas soar, electrical costs will rise as well, making power, the largest obstacle to datacenter expansion, even more daunting. Add to that a range of other threats, and the prospect is dire for datacenter producers and their customers.
As of this writing, Brent crude, the world’s preferred oil, was trading at roughly $90 a barrel, up 60% since the war began on February 28. With the Strait of Hormuz virtually closed to tanker traffic, roughly 20% of the world’s oil can’t be shipped. This has led to supply shortages and rising prices.
Exacerbating the problem are the continual Iranian attacks on energy infrastructure in the Middle East. This week, Bahrain’s state oil company, Bapco, declared force majeure (the inability to meet contractual demand due to war or similar catastrophes) after an airstrike from Iran set fire to a key facility in the country.
With supplies choked off, companies in Asia have also declared force majeure, including Aster Chemicals and Energy in Singapore and Wanhua Chemical in China.
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