How Surging Copper Demand Could Drive Silver Higher

The price of copper significantly impacts silver prices, and with copper demand projected to surge over the next couple decades, silver may benefit from this upward momentum.

Visual Capitalist, a publisher known for its economics-focused infographics, recently released an eye-catching infographic titled "Could Copper Be the Next Oil?" This title stems from Goldman Sachs' description of copper as "the new oil" due to its critical role in clean energy technologies. In 2023, the IMF projected a 66% increase in copper demand from 2020 to 2040 as the global shift away from oil gains momentum. The infographic highlights how copper demand is expected to rise significantly in the coming decades, while oil consumption is predicted to decline.

Copper plays a vital role in numerous applications, including the electrical grid, electric vehicles (EVs), and renewable energy technologies. In addition to its importance in clean energy, copper is widely used in sectors such as construction, infrastructure, and defense, thanks to its exceptional properties. Under a net-zero emissions scenario aimed at limiting global temperature increases to 1.5°C above pre-industrial levels, global copper demand is expected to rise significantly, from 25.9 million tonnes in 2023 to 39.1 million tonnes by 2040.

A significant portion of this growth is anticipated to come from the electric vehicle industry, where copper is a critical component. Battery electric vehicles, on average, contain 60-83 kilograms of copper—four times the amount used in internal combustion engine vehicles, which typically require only 15-20 kilograms of copper per car.