What is “silversqueeze”? Learn how supply, demand, and investor behaviour affect silver prices – and why current market tension isn’t a true silver short or silver squeeze yet.

Silver Squeeze: What It Means for the Silver Market in 2026

Silver Squeeze: What’s Really Happening in the Silver Market?

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You’ve probably heard the news: silver has shattered records.

 have extended the surge from 2025, when silver rose by more than 150%.

 and supply pressures make headlines. But what does the concept really mean? 

? Why is the silver market experiencing renewed tension? This article answers those questions and explains how supply, demand, and investor behaviour interact.

 is a market phenomenon where investors drive up the price by purchasing large volumes of physical silver products. This coordinated approach creates a situation where 

demand for silver rises faster than available supply

. This leads to market stress in the form of sharp price movements, delivery delays or unusually high premiums for physical silver. Essentially, 

retail investors manipulate the silver price

The term gained popularity during previous periods of market volatility. In 

. They tried to corner the silver market by 

, from around $6 per ounce in 1979 to nearly $50 per ounce by early 1980.

Regulators tightened trading rules to curb their leveraged buying. Prices began to fall, leading to ‘Silver Thursday’ – when the silver market crashed by more than 50%. Similar, though less extreme, movements also occurred in 2011.

sharp divergence between silver and gold prices

Rapid changes in lease rates and delivery availability

Why Are People Talking About Silver Squeeze In 2026?

in January 2026. Prices hit all-time highs and demand surged.

 for several years. Markets experts have long warned of a 

. The global silver market has seen a shortfall of 

around 168 million ounces per year over the past six years

, and this trend shows no sign of easing in 2026. Running a 

deficit of 100 to 200 million ounces annually

readily available above-ground silver may run low

. The problem is that nobody knows exactly how much accessible metal remains. This uncertainty makes it hard to predict when supply pressure might become critical.

Rising prices and persistent deficits in the silver market – sounds like a silver squeeze, right?

currently experiencing a true silver squeeze

This might not be a true squeeze – not yet. The data paints a more complicated picture.

moderate imbalance between supply and demand

, worsened by regional factors and investor behaviour.

 If this were a true squeeze, the ratio between would collapse as silver prices rose out of sync with gold. Instead, silver and gold are mostly moving in tandem, and moving fast. Gold surpassed the significant milestone of 

Conditions are tight, but a silver squeeze based on 

 would be a near-catastrophic scenario. It would mean that silver was unavailable anywhere, forcing exchanges and manufacturers 

While silver has hit all-time highs in dollar terms, these remain below the inflation-adjusted peaks seen in 1980 and 2011. In real terms, silver is still trading below historical extremes.

In October 2025, silver dropped nearly 5% overnight after the Shanghai Exchange raised margin requirements and triggered a wave of forced selling. If this was truly a silver squeeze, modest regulatory changes would be unlikely to shake the market that hard.

So, What Is Happening To The Silver Market?

If we’re not seeing a silver squeeze in 2026, then what’s really happening?

. Price movements are being driven by structural supply constraints, strong investment demand and regional imbalances – not a total breakdown in global physical availability.

Most silver is produced as a by-product of other metals, which limits how quickly supply can respond to higher prices.

Silver remains available globally, but access varies by region. Strong Asian demand can create temporary shortages, higher premiums, or delivery delays in Western markets. Even without a true squeeze, 

London silver stocks have fallen so low that lease rates spiked above 30%, a clear sign of stress. Analysts now estimate that less than 130 million troy ounces are freely circulating in the London market.

 Spot silver can trade above futures, reflecting regional scarcity.

Physical silver tightness, even if temporary, creates market volatility. Traders and industrial buyers may face delays or higher costs, but 

a full global shortage has not been confirmed

 Market tensions exist, but this is not yet a full-scale silver squeeze.

 Long-term physical shortfalls influence pricing, premiums and volatility.

Asian markets currently drive most of the price movement.

Investor behaviour magnifies volatility: 

Speculation can create temporary spikes, even without a true shortage.

What Should Investors Take Away From Silver Squeeze Noise?

understand the difference between market noise and structural shortages

. Approach physical silver investment with patience and context.

We’re witnessing an extraordinary run for silver, but this is not the systemic collapse sometimes predicted by silver squeeze narratives.

If demand cools or supply-demand imbalance eases, lease rates could fall and 

prices drift back towards longer-term moving averages

 – a sharp correction that could hand investors the buying opportunity they've been waiting for.

, including coins, bars, limited editions, and collector items – perfect for adding tangible silver to your portfolio, with transparent pricing and secure storage options.

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