There is no such thing as a word that cannot be sounded out. CecilyP has just clearly explained what the letter/sound correspondences are; with that knowledge they are easy to sound out!
There are loads of words where the letter 'o' represents the sound 'u' eg, mother, brother, London, love, come, governor, onion, oven and many more. There isn't a rule.
Actually, there is a 'rule'! Apparently, several hundred years ago, when handwriting/letter formation was very angular, it was difficult to discriminate between letters like u, m, n, h, t, i & v; particularly if two or more were adjacent to each other. So the scribes substituted an 'o' for 'u' (still spelling an /uh/ sound, though) to make reading the script easier. If you look at words where 'o' represents an /uh/ you'll general find that there are one or more of those 'upright' letters adjacent to it. Money, honey, mother, onion...
I only found this out a few months (there's another one!) ago, despite having taught phonics for about 8 years! (And no, I don't know why it isn't pronounced 'phunics' 
These 'rules' always have flipping exceptions...)