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Intel’s CEO says semiconductors are like oil – doing more in the United States can prevent a global crisis

Intel CEO Pat Gelsinger on Wednesday compared semiconductors to oil, suggesting computer chips will play a central role in global relations for decades to come.

“Oil has explained geopolitics for the past 50 years. While fabrics [factories] are the future of digital, they are even more important,” Gelsinger said in an interview on CNBC’s “Squawk Box.” “Let’s build where we want, and define the country we want to be part of in the U.S. and Europe.”

Fabs is a shorthand for the production of plants, a factory made of semiconductors. Most chips are currently manufactured in Asia, especially in Taiwan. The arrests raised natural security, especially as China increased its military presence near the democratic island that Beijing claims to own.

Semiconductors have also been in short supply during the Covid epidemic, as manufacturing shortcomings contradicted the increasing demand for electronics, from mobile phones to cars to washing machines.

Under Gelsinger’s leadership, Intel developed a strong push to diversify chip production. In recent months, Intel has announced huge sums of money to build new fabrics in the US and Europe. Intel also began operating last year at two chip factories in Arizona.

The President of the United States, Joe Biden, puts his hand on Intel CEO Patrick Gelsinger during the event at the ongoing procurement crisis in the South Court Auditorium for the Eisenhower Executive Office Building on January 21, 2022 in Washington, DC. Gelsinger announced that Intel Corp would invest the first $ 20 billion in production of a semiconductor production plant in Ohio.

The Santa Clara, California-based company – a powerful firm in early days of Silicon Valley – has also been pressuring officials in Washington and Brussels to support legislation that could include government funding to help build a semiconductor.

Gelsinger’s remarks Wednesday came before his testimony before the US Senate in support of a $ 52 billion aid program.

Former chief of cloud computing company VMWare, Geslinger, is not the first person to compare semiconductors with oil. But his rhetoric is further strengthened because the prices of crude oil prices have risen this year due, in part, to the Russia-Ukraine war and fears of supply disruption.

It is the current phenomenon of political instability leading to higher oil prices and, again, concern for their impact on American consumers. It happened, as it did in the 1970s power crisis.

Geslinger expressed concern over the outcome of the Russian offensive in Ukraine, also pointing to economic issues.

“While the Russian-Ukraine situation is not among any supply chain semiconductors, it only reinforces political instability and the rapid rotation of the supply chain distribution in the region – US, Europe and Asia – and is particularly strong for the digital future,” he said.

“Everything digital runs on semiconductors, and it’s important that we build these fabrics as we want.”

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