U. MACUNGIE TWP., Pa. – The war with Iran is having an impact on Air Products’ overseas operations.

The industrial gas company’s Chief Executive Officer Eduardo Menezes was asked about the conflict earlier this week during a fireside chat at the J.P. Morgan Industrials Conference in Washington D.C.

“The last three weeks, they have been a little hectic, to say the least,” Menezes said.

Air Products, headquartered in Lehigh County, has operations in a number of countries in the Middle East, including Oman, Qatar, Bahrain, Egypt and Israel. It’s a combination of sites owned and operated solely by Air Products, as well as joint ventures, such as Abdullah Hashim Industrial Gases in Saudi Arabia.

“Overall we have, directly and indirectly with the joint ventures, thousands of employees in the region,” Menezes said. “Our main concern is the security of our people, making sure that everyone is safe, making sure that we are taking the right actions to protect the people and the assets.”

According to Menezes, the direct impact to business in the Middle East has been limited to the closure of a “small plant here and there,” but a larger threat to the company’s bottom line is energy prices. 

The shutdown of the Strait of Hormuz, a vital water passageway between the Persian Gulf and the Gulf of Oman, has disrupted the flow of oil and liquefied natural gas (LNG) through the area, which has sent energy costs soaring in Europe, where Air Products operates several hubs.

In some cases, those higher costs will be covered by customers as part of a “pass through” agreement, but they also directly impact the gas separation side of Air Products’ business, Menezes said. “The environment is very complicated right now.”

The war is also threatening the global helium supply; QatarEnergy’s Ras Laffan Industrial City, a leading helium producer near Doha, has been crippled by Iranian attacks. 

Menezes said Air Products had enacted some contingency measures, including running U.S. liquefaction plants at capacity.

Helium is used in a number of industries, from technology to healthcare to specialized welding. Even before the war with Iran, some experts were concerned about a shortage. “I think at the end of the day, the most critical customers the industry will find a way to keep them supplied the next few months, even if the conflict goes forward,” Menezes said, “but you’re going to have some hiccups here and there, and you’re going to have some less vital sectors that will suffer a little more than the electronics or MRIs and that kind of stuff.”

Air Products is currently in the process of building a green hydrogen plant in Saudi Arabia alongside other partners. Menezes said, so far, the construction site has not been disturbed by the military conflict. “The only concern we have right now is for people moving in and out of in the region. Traveling is a little bit restricted now,” he said.