Big Tech’s Gulf Megaprojects Face Critical Risks Amid War-Torn Choke Points

Billions of dollars in U.S. technology infrastructure and trillions more in planned investments are now at risk due to fiber-optic cables traversing conflict zones. Major tech companies, including Amazon, Microsoft, and Google, have invested heavily in data centers across the Gulf, anticipating the region would emerge as a global hub for artificial intelligence. However, the undersea cables that connect these facilities to Africa, South Asia, and Southeast Asia now pass through two critical maritime chokepoints: the Red Sea and the Strait of Hormuz, both of which are currently closed to commercial traffic.

Escalating Tensions in the Gulf

On March 3, Iran’s Islamic Revolutionary Guard Corps announced the closure of the Strait of Hormuz, threatening to “set ablaze” any vessel attempting to pass through. This declaration has resulted in damage to at least five tankers and left approximately 150 ships stranded in the area. Concurrently, Houthi militants in the Red Sea have resumed attacks on shipping, ending a ceasefire that had been in place since late 2025. The ongoing conflict, which began on February 28, has transformed both chokepoints into active war zones—a situation unprecedented in history.

Approximately 17 submarine cables run through the Red Sea, facilitating the majority of data traffic between Europe, Asia, and Africa. Additional cables traverse the Strait of Hormuz, serving countries such as Iran, Iraq, Kuwait, Bahrain, and Qatar. If any of these cables are severed, specialized repair ships would be unable to access either passage safely.

Doug Madory, director of internet analysis at the network intelligence firm Kentik, stated, “Closing both choke points simultaneously would be a globally disruptive event. I’m not aware of that ever happening.”

Unprecedented Threats to Data Infrastructure

The Gulf’s data infrastructure has never faced such severe testing. Unlike oil, which has been exposed to decades of conflict and is integrated into military planning, data centers have traditionally been viewed as commercial assets rather than national security concerns. Kristian Alexander, a senior fellow at the Rabdan Security and Defence Institute in Abu Dhabi, remarked that “a theoretical scenario has become a concrete precedent,” validating existing threat models.

The urgency of the situation was underscored when drones targeted three AWS data centers over a recent weekend, two located in the UAE and one in Bahrain. AWS advised its customers to consider migrating workloads out of the Middle East entirely, citing an “unpredictable” regional operating environment.

While the cables are not the primary target of attacks, the risk of accidental damage remains high. In February 2024, three cables in the Red Sea were cut by the anchor of a cargo ship struck by a Houthi missile, disrupting 25% of traffic between Asia, Europe, and the Middle East. Repairing one of those cables took five months due to safety concerns. If multiple cables were severed now, the disruption could extend for an even longer period.

Gaps in U.S. Security Frameworks

The current crisis highlights significant gaps in how the U.S. has approached its technology expansion in the Gulf. Security frameworks have primarily focused on preventing advanced chips from reaching China, rather than safeguarding physical infrastructure from missile attacks. Sam Zabin, a fellow at the Center for Strategic and International Studies, noted that U.S. government and industry leaders have prioritized expansion over risk mitigation, reflecting a disconnect between AI development and national security doctrine.

The timing of these developments is particularly concerning. A tour of the region by U.S. President Donald Trump last May resulted in $2.2 trillion in investment pledges, based on the Gulf’s perceived strengths, including political alignment with Washington and world-class infrastructure. Companies like OpenAI, G42, Oracle, Nvidia, and SoftBank announced plans for a 5-gigawatt AI campus in Abu Dhabi, while Amazon committed $5 billion to an AI hub in Riyadh.

However, the U.S. decision to strike Iran has jeopardized these investments. Following the initiation of Iranian attacks, the UAE intercepted 165 ballistic missiles, two cruise missiles, and 541 drones over a single weekend. Saudi Arabia and Qatar have also mounted robust defenses.

The U.S. security architecture surrounding these investments has focused on different threats. The January 2026 Pax Silica initiative aimed to prevent advanced semiconductors from reaching China, leading to significant shifts in partnerships. For instance, Abu Dhabi’s G42 severed ties with Huawei, and Humain aligned with U.S. chip suppliers.

Ali Bakir, an assistant professor of international affairs at Qatar University, pointed out that the security frameworks underpinning the U.S.-UAE AI partnership have prioritized supply chain control and geopolitical alignment over physical defense during high-intensity conflict.

Digital Blackout in Iran

Inside Iran, the regime has imposed a digital blackout. Data from Kentik indicates that internet traffic into the country collapsed on February 28 and has remained near-zero since then. The three largest Iranian networks—MCCI, MTN Irancell, and TIC—have all experienced significant drops in traffic, suggesting a deliberate government shutdown rather than infrastructure damage.

The Gulf retains its structural advantages, including capital, energy resources, and strategic location. Both the UAE and Saudi Arabia have pipelines that can bypass the Strait of Hormuz for oil exports, and both governments have demonstrated their capability to defend their territories.

Ryan Bohl, a senior analyst for the Middle East and North Africa at RANE Network, stated that while the structural advantages have not changed, the ongoing conflict could alter perceptions of safety and value in the long term.

Abishur Prakash, a geopolitical strategist, noted that few anticipated the U.S. would strike Iran, leading to retaliatory actions that have left technology infrastructure vulnerable. He emphasized that the current situation has inverted previous strategic planning, exposing the entire technology landscape and ambitions of the region.

The U.S. must begin treating Gulf data infrastructure with the same level of importance as oil, integrating it into contingency planning and regional security coordination. Such frameworks took decades to establish for energy, but similar measures for technology infrastructure are still lacking.

Explore the latest digital editions of FAME Delivered in the Magazine section.

Published on 2026-03-04 16:10:00 • By FAME Delivered News Desk