The price of crude helium set by the federal government has skyrocketed in the past three years, jumping from $64.75 to $84 per 1,000 cubic feet, as supplies of the element have tightened amid increasing demand, primarily in Asia. The price crunch could get much worse as the Bureau of Land Management — which supplies about 30% of the global supply of helium — prepares to shut down the federal helium reserve outside Amarillo, Texas.

In liquid form, helium can achieve the coldest temperatures on Earth, approaching absolute zero, and is vital to the manufacture of fiber-optic cables, liquid-crystal displays, and semiconductors. It’s also necessary during rocket launches and to cool the magnets in MRI machines. There is no substitute. About a year ago, as prices continued to spike and smaller users like scientific researchers and party stores struggled to put their hands on the limited supplies of helium, Sears finally lined up funding for helium extraction, with an investment from Weil Resources Group, a global energy firm based in Richmond. He’s overseen the drilling of helium wells near natural-gas fields in northwest Montana and southern Saskatchewan and could be selling gaseous helium to the balloon industry in the next 12 months.

Helium is the second most abundant element on earth, but most of it floats in the atmosphere, where it is prohibitively expensive to extract. The inert gas is created by the radioactive decay of uranium and thorium and leaks out into the air if it is not trapped by the right kind of geological formation. A lot of helium slips into the atmosphere during natural gas extraction, but the shale boom in the U.S. hasn’t stemmed the helium shortage and may have made it worse. The fields where shale gas is being produced have not shown helium in high enough concentrations to make its extraction economical. And with the price of natural gas so low, producers are not going to tap the more traditional gas fields, which have historically produced helium, anytime soon.

“The key decisions are not about helium. It’s about investing in the primary product — natural gas,” says John Campbell, president of J.R. Campbell & Associates, a gas consulting firm and the publisher of CryoGas International. “The price of gas is not high enough right now to influence investment in helium as byproduct.”

The federal government is the biggest player in the global helium market, and Congress has suffered from bad timing on the issue. In 1996 lawmakers voted to get out of the helium business, mandating the sale of federal reserves to repay the $1.4 billion spent to establish the Texas facility — mostly interest on an initial investment of $250 million. Soon after, demand soared, as MRIs came into wider use and the technology boom made the gas invaluable to manufacturers of products like cellphones and Internet cables. In the absence of a true open market for helium, the BLM price, which has been artificially low in recent years, has become the de facto benchmark. And the government’s supply of helium seems to have held back private investment in new sources of the element. Now, with global supplies tight, inaction by Congress could bring chaos to the market. BLM is preparing to make its final payment to the U.S. Treasury as soon as Sept. 30, which by law would trigger a shutdown of the reserve. There are bills with bipartisan support in the House and Senate to keep the reserve operating for a few more years — enough time to exhaust the estimated 5-to-10-year federal helium supply and give private producers a chance to develop new sources.

It’s all in the hands of a dysfunctional Congress facing immigration reform and the next round of the debt-ceiling fight, raising the possibility that the price of helium will continue to rise up into the atmosphere.

A shorter version of this story appeared in the August 12, 2013 issue of Fortune.