Platinum ended the week at $2,413.62 per ounce[5], marking an 8% increase from the level on December 26 and the strongest annual gain since at least 1987; prices have already risen over 150% in 2025. The rally extended to a 10-day winning streak, the longest since 2017, as tight supply met renewed industrial and investment demand.
Growth Drivers
The European Commission announced on December 16 a decision[1] that alters the plan for 2035: instead of a total ban on the sale of cars with combustion engines, it introduces a target of 90% CO2 emission reduction[2]. The decision, made after intense pressure from Germany, Italy, and car manufacturers, allows continued sales of plug-in hybrids and vehicles powered by CO2-neutral fuels after 2035.
Supply Issues and Deficit
Analysts highlight the direct effects this change will have on platinum demand as the automotive industry accounts for about 30–40% of annual demand[6] for this metal. Catalytic converters use platinum to reduce exhaust emissions[7], so relaxing regulations extends the lifespan of platinum-containing components and raises demand in upcoming years.
The market also faces supply challenges. The World Platinum Investment Council forecasts a deficit of 692,000 ounces in 2025[8], equivalent to about 9% of global demand. South Africa remains the main producer, supplying around 80% of the world’s platinum, but struggles with aging infrastructure, energy supply restrictions, and rising operational costs.
Impact of China and Market Outlook
Above-ground platinum stocks have fallen to about 3.2 million ounces[13], providing less than five months’ worth of global consumption and marking the lowest level since 2020. Platinum is rarer than gold — roughly 30 times scarcer — and annual mined production is only about 190 tons, further limiting the ability to quickly balance the deficit.
China launched platinum futures trading[16] on the Guangzhou Futures Exchange on November 27, creating a new price discovery mechanism and attracting investors. Analysts predict that Chinese demand for platinum bars and coins will reach 418,000 ounces in 2025[20], a 47% year-on-year increase.
The combination of limited supply, low inventory, and rising demand from automotive and investment sectors maintains pressure on prices. Investors and car manufacturers will closely monitor further regulatory decisions and situations at mines in South Africa[12]; these factors will largely determine whether the current rally endures over the longer term.