Silver is up 4.2% to $82.03 an ounce internationally and 3.89% to ₹2,58,300 on MCX today. The reason is one announcement — Iran opened the Strait of Hormuz.
Here is the simple version of why that single event sent silver surging.
The One Thing That Happened
At 6:15 PM IST on Friday, Iranian Foreign Minister Araghchi posted on X that the Strait of Hormuz is completely open to all commercial vessels for the ceasefire period. Donald Trump confirmed it minutes later. Oil crashed 11%. And silver — perhaps counterintuitively — shot up over 4%.
Why Silver Goes Up When Oil Goes Down
Silver is not just a precious metal you buy when you are scared. About 60% of all silver demand in the world comes from industries — solar panels, electric vehicles, electronics, semiconductors. These industries use massive amounts of silver and they are also massive consumers of energy.
When oil crashes because the Strait of Hormuz opens, the cost of running factories and manufacturing plants falls sharply. That makes it cheaper to produce solar panels, electronics and EVs. Cheaper production means more production. More production means more silver needed. The market prices that increased industrial demand immediately — which is why silver is up even as the conflict that was driving fear-based buying eases.
The Second Reason — Gold’s Story Applies to Silver Too
Silver is also a monetary metal like gold. Gold is up 2% today for the same macro reason — lower oil reduces global inflation expectations, which pushes real interest rates down, which makes precious metals more attractive. Silver gets the same benefit that gold gets from this chain of reasoning, and then adds its own industrial demand argument on top of it.
Gold rose 2%. Silver rose 4.2%. The extra 2.2% is the industrial demand story doing its work.
The Simple Summary
Oil crashed because the Strait opened. Cheaper oil means cheaper manufacturing. Cheaper manufacturing means more solar panels, more EVs, more electronics — all of which need silver. At the same time, lower oil reduces inflation fears, which is good for all precious metals. Silver benefits from both effects at once. That is why it is the biggest gainer in the precious metals complex today and why the move is larger than gold’s.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Commodity prices are subject to rapid change. Readers are advised to consult a SEBI-registered financial advisor before making investment decisions.