Silver tumbled sharply in early U.S. trading Friday, with spot prices sliding 2.55% to around $76.085 an ounce as a firmer dollar and renewed oil volatility offset support from softer Treasury yields. Gold also gave back recent gains, with spot bullion down 1.26% near $4,512.50 an ounce, according to data tracked by Kitco News.
The pullback came as fresh U.S. strikes on Iranian targets in southern Iran reversed Monday's sharp oil selloff and clouded the outlook for a fragile cease-fire. Brent crude rebounded above $95 a barrel and WTI moved back toward $92, scrambling the dollar-down, metals-up trade that had carried silver and gold higher earlier in the week.
Iran Headlines Drive the Tape
President Donald Trump said Washington and Iran had "largely negotiated" a memorandum of understanding on a peace deal that would reopen the Strait of Hormuz, comments that initially fueled risk-on flows and weighed on havens. But that optimism unwound after the latest U.S. military action.
Vice President JD Vance, speaking earlier Friday, told reporters the two sides were "not there yet" on an initial agreement, though he added "we're very close." The agreement, if reached, would extend a cease-fire, reopen the strait, and advance broader talks on Iran's nuclear program.
The whipsaw is becoming familiar for metals traders. Oil prices have tumbled more than 10% since May 18, when Trump first said he was calling off an imminent wave of strikes to allow more room for negotiations — only to reauthorize action this week. Each headline flip is reverberating through the dollar, real yields, and the gold-silver complex.
The Structural Story Hasn't Moved
Beneath the daily noise, the supply-and-demand setup for silver remains historically tight. The Silver Institute's World Silver Survey 2026 projects a 46.3 million-ounce market deficit this year — the sixth consecutive annual shortfall and a widening from 40.3 million ounces in 2025. Since 2021, the market has drawn a cumulative 762 million troy ounces from above-ground stocks to cover the gap.
Physical investment is forecast to rise roughly 20% to a three-year high of 227 million ounces, with the Institute citing "exceptional price performance and ongoing macroeconomic uncertainty" as catalysts for a recovery in Western bar-and-coin demand. Industrial fabrication is expected to ease about 2% to roughly 650 million ounces — a four-year low — on weakness in the photovoltaic sector, but total demand is projected to remain broadly flat as investment offsets the industrial softness.
That structural picture explains why every Iran-driven dip has been bought aggressively in 2026. Silver is still up sharply on the year, with analysts at goldsilver.com noting a roughly 144% surge over the prior 12 months heading into the spring.
What to Watch
For the immediate tape, three variables matter most: the path of Brent crude, the dollar index, and any concrete language out of Washington or Tehran on a memorandum. A confirmed reopening of the Strait of Hormuz would almost certainly trigger another leg lower in oil and a further dollar bid — both near-term headwinds for the metals.
But the longer-term thesis sits on a different timeline. As the Silver Institute put it, the market is now in its sixth year of structural deficit "with no sign of slowing," and inventories remain near historic lows. Friday's move is volatility, not a change in regime.
Sources: Kitco News, CNBC, TheStreet, Fortune, Silver Institute World Silver Survey 2026.