Silver prices in India witnessed a decline on Tuesday, with investors adopting a cautious stance ahead of crucial US economic data. On the Multi Commodity Exchange (MCX), silver was trading at ₹199.10 per gram and ₹1,99,100 per kilogram. This marks a retreat from the previous session's level of ₹2,03,000 per kg. The dip is attributed to market anticipation of key US jobs and inflation figures, which are expected to influence the Federal Reserve's monetary policy path into 2026.
A Historic Reversal: Silver Surpasses Oil
Despite the daily drop, the broader narrative for silver remains exceptionally bullish, underscored by a historic market milestone. For the first time since the early 1980s, the price of silver has surged ahead of West Texas Intermediate (WTI) crude oil. Currently, one ounce of silver trades around $63.80, overtaking WTI crude at approximately $57.30 per barrel. This is a dramatic reversal from mid-2022, when crude oil near $95 was more than 4.5 times costlier than silver at around $20.
This shift highlights a massive re-pricing across major commodities. In 2025 alone, silver has skyrocketed over 150%, marking its strongest annual performance since 1979. Since early 2020, silver has gained more than 220%. In stark contrast, oil has slumped by 44% over the same period, with WTI crude down about 20% in 2025 and heading toward its worst annual decline since the 2020 pandemic crash.
Why is Silver Soaring While Oil Slumps?
The meteoric rise of silver is fueled by a powerful combination of monetary and industrial factors. Cooler US inflation, expectations of interest rate cuts by the Federal Reserve, and a weaker US dollar have enhanced its appeal as an investment asset. Simultaneously, the market is grappling with structural supply shortages due to stagnant mine output and five consecutive years of declining above-ground stocks.
On the industrial front, demand is booming. The metal's year-to-date surge of 121% is supported by tightening inventories and robust consumption from key sectors like solar panels, electronics, electric vehicles (EVs), and data-center applications. Spot silver prices, while down 1.7% to $62.88 an ounce from Friday's record high of $64.65, recently reclaimed the crucial ₹2 lakh per kg mark on MCX, aided by strong global cues and a weaker Indian rupee.
Oil, however, remains trapped in a bearish cycle. Global oversupply, softening industrial and transport demand, energy efficiency gains, and uneven production strategies from OPEC nations continue to cap prices. Persistent demand weakness in major economies like Europe and China has further intensified the slide.
Expert Outlook: Can the Silver Rally Sustain?
NS Ramaswamy, Head of Commodity & CRM at Ventura, provided insights into the rally. He noted that silver's surge was partly a delayed catch-up to gold's earlier bull run. However, he highlighted a key vulnerability: "Unlike gold’s liquidity, silver lacks depth in the institutional lending base, making it vulnerable when London stocks tighten." He referenced the October squeeze triggered by tight physical stocks, which led to an 11% correction in silver between October 17 and 21.
Ramaswamy emphasized that beyond stock tightness and silver's addition to the US critical mineral list, multiple forces are propelling prices. These include strategic stockpiling and soaring demand from electronics, alternative energy, EVs, artificial intelligence, and data centers. Silver is now poised to play a pivotal role as a 'next generation metal' essential for the green energy transition and digital transformation.
Looking ahead, he suggested silver could potentially climb to $100 per ounce, roughly equivalent to ₹3 lakh per kilogram. However, he issued a strong caution, reminding investors that silver is historically prone to extreme boom-and-bust cycles. "When supply catches up with demand, that would be a signal of Peak Silver," he warned.
In related precious metals movement, spot gold edged 0.3% lower to $4,289.17 per ounce but remains up 64% year-to-date. Platinum climbed 1.7% to $1,812.80, and palladium rose 0.6% to $1,579.44.
