Silver prices in India have gained momentum as geopolitical tensions between the US, Israel and Iran amplify safe-haven demand, pushing rates closer to Rs. 3 lakh per kg on the Multi Commodity Exchange (MCX). Analysts are evaluating whether the ongoing conflict could sustain this rally.
Silver has kicked off the week with strong momentum amidst escalating tensions between the United States and Iran. The conflict has pushed investors toward traditional safe-haven assets. Spot silver rose 1.4% to $90.67 per ounce on Tuesday (March 3, 2026), after touching a more than four-week high in the previous session.
The situation intensified after Iran’s Islamic Revolutionary Guard Corps (IRGC) reportedly announced the closure of the Strait of Hormuz, which is a key oil transit route handling nearly one-fifth of global crude flows.
Following recent military strikes by the US and Israel against Iranian targets over last weekend, Iranian forces retaliated with attacks against multiple Gulf States. As a result, the price of commodities suffered greatly as this increases geopolitical risk premium into precious metals.
The supply deficit in Precious Metals has been year on year for an extended period of time and industrial demand from electric vehicles, AI and solar have been growing rapidly at an unprecedented rate.
Renisha Chainani, Head Research at Augmont, highlighted that the current rally is not purely war-driven.
“Silver is setting up a potential extension toward fresh highs. The rally is underpinned by a persistent multi-year supply deficit, strong industrial demand from electric vehicles, AI infrastructure, and solar energy, as well as renewed investment inflows and geopolitical risk premiums.”
China, the world’s largest silver consumer, has accelerated post-Lunar New Year restocking of silver and copper. China appears to be strategically stockpiling key metals to secure supply chains for its manufacturing base, especially in EVs and renewables.
Mexico, the world’s largest silver producer, accounts for roughly one-quarter of global output. A significant share of its mines are located in regions impacted by cartel-related violence.
Will Silver hit Rs. 3 lakh? Only time will tell.