History has witnessed this only three times: silver prices have surpassed crude oil—could the old energy order be unraveling?

Silver prices have surpassed crude oil prices—a feat that has occurred only three times in history. This development underscores the gradual erosion of the traditional energy pricing framework, as renewable energy and strategic metals increasingly assume the status of core assets.

 

In the just-concluded year 2025, the global commodities market, amid a complex and volatile macroeconomic environment, witnessed a historic divergence characterized by stark contrasts—“ice and fire.”

 

On one hand, precious metals such as gold and silver have embarked on an epic bull market: silver has surged more than 140%, posting its largest annual gain on record, while gold has risen over 60%, delivering its strongest performance since 1979. Meanwhile, industrial metals—led by copper—have staged a robust rebound, repeatedly hitting new all-time highs.

 

Meanwhile, the energy market remains mired in a downturn, with prices continuing to fall under the dual pressures of supply-demand imbalances and weak demand. WTI crude oil posted an annual decline of over 18%, marking its largest yearly drop since 2020.

 

Amid the divergent dynamics of soaring gold and silver prices on one hand and struggling crude oil on the other, the commodities market witnessed a rare phenomenon: both spot and futures prices for silver exceeded those of a barrel of crude oil.

 

This rare phenomenon has occurred only three times in history; if we exclude the period of the 2020 pandemic, when pricing was abnormal, it has happened just twice.

 

As December began, London spot prices—serving as an international benchmark for silver—surpassed $60 per ounce on the 10th and $70 per ounce on the 23rd, before briefly climbing above $80 per ounce on the 29th, setting a new all-time high. Meanwhile, U.S. West Texas Intermediate (WTI) crude oil futures fell below $55 per barrel in mid-December, hitting their lowest level in roughly four years and ten months.

 

Since the launch of WTI crude oil futures trading in 1983, it has been extremely rare for silver prices to remain consistently higher than those of crude oil. The last time this occurred was in April 2020, when the COVID‑19 pandemic sent energy prices plummeting; however, oil prices subsequently rebounded swiftly, reflecting an atypical pricing anomaly. Even earlier instances can be traced back to the 1980s.

 

As 2026 began, even in the wake of the sudden geopolitical development of the United States’ forceful efforts to rein in Venezuelan leader Nicolás Maduro, crude oil prices did not follow their usual pattern of rising at Monday’s open; instead, they posted an unexpected decline. Brent crude briefly fell as much as 1.2% to $60 per barrel at the open before eventually staging a modest rebound.

 

Meanwhile, on Monday, safe-haven capital poured into the precious metals market. Spot gold broke through $4,400, while spot silver surged 5%; New York silver prices soared nearly 10% at one point during the session, and COMEX silver futures rose 7.63% to $76.430 per ounce. This also pushed the silver-to-crude oil price ratio above 1.2.

 

The price of one ounce of silver has remained above that of one barrel of crude oil, a trend closely tied to the accelerating global energy transition. What new signals does this historic “reversal” reveal?

 

Caption: Silver-to-crude oil price ratio

Source: Investing

 

The sharp rise in silver prices is primarily driven by both investor demand and industrial consumption. On the investment front, this precious metal is being stockpiled in substantial quantities—both as a physical commodity and as a financial asset—to preserve wealth and hedge against risks associated with the U.S. dollar and other currencies.

 

In industrial applications, demand for silver is closely tied to the global energy transition. From solar panels to electric vehicles and other clean-energy sectors, silver consumption continues to rise, providing robust long-term demand support.

 

A recent report titled “Silver: The Metal of the Next Generation,” released by the World Silver Institute, indicates that global industrial demand for silver is expected to continue rising over the next five years, driven by accelerating growth in key sectors such as solar energy, electric vehicles, and data centers.

 

The report notes that silver’s outstanding electrical and thermal conductivity is increasingly becoming an indispensable key enabler of the global economy’s technological transformation. A 17% annual compound growth rate in the photovoltaic industry, a 13% annual compound growth rate in the electric‑vehicle sector, and the explosive expansion of data centers together form the three major pillars driving the growth in silver demand.

 

Its three key attributes—high electrical conductivity, excellent thermal conductivity, and superior corrosion resistance—make silver the material of choice for both front- and back-side conductive pastes in solar cells. Over the past decade, global photovoltaic installed capacity has grown by more than tenfold, while the share of silver demand from the PV sector in total industrial silver demand has surged from 11% in 2014 to 29% in 2024.

 

Caption: Industrial Silver Demand, 2014–2024

Source: The World Silver Institute

 

Citigroup’s analysis indicates that the solar industry alone already accounts for nearly 30% of global annual silver production, underscoring the rigidity of its structural demand gap. John Ciampaglia, CEO of asset management firm Sprott Asset Management, stated: “Even as the United States scales back its support for solar energy, other countries are not slowing the pace of solar capacity additions, and this is driving a substantial surge in silver demand.”

 

However, as silver prices have surged, the rising cost of silver paste is posing new challenges to the photovoltaic industry. According to an analysis by Guojin Securities, the share of silver paste costs has increased markedly over the past six months, overtaking silicon material as the primary cost driver—its proportion has jumped from 10.5% to 17%, surpassing the peak level of 15% seen during the silicon‑material boom.

 

Beyond photovoltaics, the automotive industry’s shift toward electrification is also driving up silver demand. Electric vehicles, with their higher degree of electrification, require significantly more silver than conventional internal‑combustion‑engine cars; on average, each battery‑electric vehicle consumes 25–50 grams of silver, a quantity roughly 67%–79% greater than that used in traditional gasoline‑powered vehicles.

 

Driven by rapidly growing demand and production of electric vehicles, silver demand from the EV sector is expected to surpass that of internal‑combustion vehicles by 2027, accounting for 59% of total automotive silver demand by 2031. Moreover, rising demand for charging infrastructure will further boost silver consumption.

 

Forecasts indicate that global silver demand in the automotive sector will grow at a compound annual growth rate of 3.4% between 2025 and 2031, reaching approximately 94 million ounces by 2031.

 

Meanwhile, on the supply side, there is little prospect of a substantial increase in new production entering the market. Global deposits of “primary silver” have largely been exhausted, and today silver is increasingly recovered as a byproduct of mining other metals such as copper, gold, and zinc. At the same time, the incremental volume from recycling falls short of closing this gap, leaving the supply side ill‑equipped to meet surging demand and further widening the supply‑demand imbalance in the silver market.

 

Caption: Outlook for Global Automotive Industry Silver Demand

Source: Oxford Economics

 

In stark contrast to the supply shortages in the silver market, the crude oil market is awash with oversupply, keeping energy prices under persistent pressure. By 2025, WTI crude oil futures have already fallen by more than 20%, while Brent has dropped over 19%, both hovering near their lowest levels since 2022. Price levels have approached the breakeven points of most producers, placing significant strain on the industry as a whole.

 

At the same time as supply remains abundant, global oil demand is undergoing a historic transformation driven by the accelerating energy transition. According to the International Energy Agency’s (IEA) long-term outlook released in June 2025, China—already the world’s second-largest oil consumer after the United States—is expected to see its oil demand peak in 2027.

 

In new-car sales, the share of new-energy vehicles—including battery electric vehicles (BEVs)—in China surpassed 50% for the first time in October. As electric vehicles gain widespread adoption, demand for gasoline in China has already begun to decline.

 

Amid a slowdown in demand growth, China’s crude oil imports have already begun to decline from their recent peak. In 2024, China’s crude oil imports totaled 553 million tonnes, down 1.9% year on year. Aside from the impact of the pandemic, this marks the first annual decline in China’s crude oil imports in nearly two decades.

 

In early 2025, the PetroChina Economic & Technical Research Institute noted in its “2024 Report on the Development of the Domestic and International Oil and Gas Industry” that China’s oil consumption is entering a plateau phase after reaching its peak, with demand for refined petroleum products having already reached an inflection point and begun to decline.

 

The institution forecasts that China’s petroleum consumption structure is shifting toward “declining refined‑product use and rising petrochemical feedstock demand.” With fuel substitution in the transportation sector, China’s oil consumption could peak as early as 2025. Under the framework of a new energy system, petroleum’s role is gradually evolving from a primary transportation fuel to a dual‑purpose function: ensuring energy supply for transport while serving as a key feedstock for industrial applications.

 

Figure Caption: China’s Refined Oil Consumption Trends and Forecasts

Source: PetroChina Economic & Technical Research Institute

 

Looking ahead, the Silver Institute forecasts that a silver supply deficit will persist through 2026. While some analysts anticipate a potential narrowing of the gap, the ongoing structural imbalance—driven by stagnant mine production (around 813 million ounces per year) and record‑high industrial demand—will continue to underpin rising silver prices.

 

Several analysts predict that silver prices could break through the $100 mark, despite the potential for sharp volatility along the way. John Rubino, a renowned financial writer, co-author of “The Dollar Collapse,” and former Wall Street analyst, notes that silver, with its strong industrial characteristics, has become a strategic commodity in the race for new energy and artificial intelligence.

 

He predicted, “Big Tech players are already moving to secure silver to ensure their supply over the next few years. Indeed, some of them have already begun considering acquiring silver mines. Perhaps Tesla will acquire First Majestic or a similar mine to safeguard its future silver supply.”

 

Meanwhile, market expectations for crude oil have generally turned more cautious. According to the International Energy Agency (IEA), global oil supply is projected to exceed demand by 3.8 million barrels per day in 2026, marking a record level of oversupply. In its latest report, Goldman Sachs forecasts that the average annual price of U.S. WTI crude will be around $52 per barrel in 2026.

 

JPMorgan’s outlook is similarly bearish, forecasting average Brent and WTI crude prices of $58 per barrel and $54 per barrel, respectively, in 2026. The key rationale is that over the next two years, supply growth is expected to outpace demand growth by a factor of three, making it difficult for the market to shift away from its current loose‑supply dynamic.

 

This means that, for a long time to come, the price of one ounce of silver will remain above the price of one barrel of crude oil. It is also a highly symbolic market signal: the traditional energy pricing system, anchored in oil, is beginning to loosen, while new energy sources and strategic metals are ascending into the ranks of core assets.