Recently, Dean Belder focussed on Geopolitics and the silver price relationship in the Silver Price Update: Q2 2025 in Review-INN. By breaking ice he said, adding to the tailwinds is a growing east-west divide. Due to its usage in industrial components, particularly those related to the military and energy sectors, and its role as a safe haven, silver is being influenced by geopolitics.
June’s price rally came alongside growing speculation that Israel was preparing to attack Iranian nuclear sites. Investors became concerned that war could disrupt international trade and oil movements in the region. Ultimately, their concerns were proven right, and Israel launched attacks on June 12; the US then bombed key nuclear facilities on June 21. While the escalation is new, the underlying politics have been simmering for years.
Sanctions against Russia have strengthened support among the BRICS nations, which have been working to reduce their reliance on US dollar assets, such as treasuries, and increase trade in their own currencies. But they may also be working to separate themselves from western commodities markets. In October 2024, Russia floated the idea of creating a precious metals exchange to its BRICS counterparts. If established, it could shake up pricing for commodities like silver, allowing Russia to circumvent sanctions and trade with its bloc partners.
While the exchange is still just an idea, a bifurcated world is not. While the US has targeted most nations with tariffs, it has singled out China. Much of the first half of the year saw the world’s two largest economies escalate import fees with one another, with China even restricting the export of rare earth elements to the US.
Discussions on national security and critical minerals have been at the forefront for the last several years. Still, they have become even more pronounced with the US and China on tense footing. In a July 9 interview with INN, economist and author Dr. Nomi Prins suggested that national security demands are likely to offset the impact of any economic downturn on the broader economy.
“Even if that’s going to happen, industrial use value — building infrastructure, building national security, national energy priorities — needs a lot of silver, and there just simply isn’t enough supply out of the ground to meet the demand. That’s long-term demand above the ground. This has been a thing, but right now, because of these geopolitical forces and realignments, silver is going to drop more into that industrial role,” she said.
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