Silver burst through $77 per ounce on Friday, December 27, extending its remarkable 2025 rally to 167%—the strongest annual gain since the Hunt brothers' infamous squeeze in 1979-1980. The white metal has outpaced even gold's historic run, driven by a unique combination of safe-haven demand, industrial applications, and a recent policy change that designated silver as a U.S. critical mineral.

Friday's Action

Silver's December 27 performance:

  • High: $77.12 per ounce (all-time record)
  • Daily gain: Approximately 7%
  • 2025 year-to-date: +167%
  • Price at start of 2025: Approximately $29 per ounce
  • Best year since: 1979-1980 Hunt brothers era

The Critical Mineral Catalyst

A landmark policy change has turbocharged silver's rally. In November 2025, the U.S. Department of the Interior officially added silver to the Critical Minerals List—a designation that:

  • Reclassifies silver as essential for national security and economic stability
  • Unlocks federal stockpiling initiatives
  • Streamlines permitting for domestic mining operations
  • Qualifies silver projects for government financing support

The designation acknowledges silver's irreplaceable role in solar panels, electronics, and medical devices—sectors critical to America's technological competitiveness.

Why Silver Is Outperforming Gold

Silver's 167% gain dwarfs gold's impressive 70% rise. The reasons:

Industrial demand boom: Unlike gold, which is primarily monetary, silver has extensive industrial applications:

  • Solar panels: Each panel requires approximately 20 grams of silver; 2025 solar installations hit record levels
  • Electronics: Silver's conductivity makes it essential in smartphones, EVs, and AI hardware
  • Medical devices: Antimicrobial properties drive healthcare applications
  • 5G infrastructure: Network buildout requires significant silver

Supply deficit persists: The Silver Institute estimates a 95 million ounce deficit in 2025—the fifth consecutive year of shortfalls. Mining production has failed to keep pace with demand.

Gold-to-silver ratio compression: The ratio has fallen from over 80:1 early in 2025 to approximately 60:1, suggesting silver is catching up after years of underperformance.

The 1979 Comparison

Silver's 167% gain invites comparison to the legendary 1979-1980 rally:

Then (Hunt brothers): Nelson Bunker Hunt and William Herbert Hunt attempted to corner the silver market, driving prices from $6 to nearly $50 per ounce before regulators intervened.

Now (2025): The rally reflects genuine supply-demand fundamentals rather than manipulation. Industrial demand is real. Supply deficits are documented. The critical mineral designation adds policy support.

The key difference: 2025's rally appears sustainable, while the Hunt brothers' scheme collapsed spectacularly in 1980.

Analyst Targets

Wall Street analysts see further upside:

  • Near-term target: $80 per ounce within reach by year-end
  • 2026 target: Some analysts project $100+ if supply deficits persist
  • Key driver: Solar demand expected to grow another 20% in 2026

Peter Grant of Zaner Metals noted: "$80 in silver is within reach by year-end. For gold, the next objective is $4,686.81, with $5,000 likely in the first half of next year."

Supply Challenges

Silver supply cannot easily expand to meet demand:

Primary production limited: Only about 25% of silver comes from dedicated silver mines. Most is produced as a byproduct of copper, lead, and zinc mining.

Long lead times: New mines take 7-10 years from discovery to production.

Underinvestment: Years of low prices discouraged exploration and development.

Recycling constraints: Much silver is used in ways that make recycling difficult or uneconomical.

Investment Vehicles

For investors seeking silver exposure:

  • Physical silver: Coins (American Eagles, Canadian Maples) and bars
  • ETFs: SLV (iShares Silver Trust) offers liquid exposure
  • Mining stocks: First Majestic, Pan American Silver, Hecla Mining
  • Futures: CME silver contracts for sophisticated traders

Risks to Monitor

Despite the bullish backdrop, risks exist:

Volatility: Silver is historically more volatile than gold; 20-30% corrections are normal even in bull markets.

Industrial slowdown: A global recession would hurt industrial demand.

Technological substitution: High prices could accelerate research into silver alternatives.

Speculative excess: Heavy futures positioning creates unwind risk.

The Bottom Line

Silver's surge through $77 and 167% year-to-date gain represents a fundamental repricing of the metal. The critical mineral designation, persistent supply deficits, and booming industrial demand have transformed silver's investment case. Unlike the Hunt brothers' manipulation, today's rally appears rooted in genuine fundamentals. With solar installations expected to grow further and supply constraints persistent, the bull case remains intact. However, silver's notorious volatility means investors should size positions appropriately and be prepared for sharp pullbacks along the way. At 167% gains, some profit-taking would be healthy—but the structural story for silver may be just beginning.