A Convergence of Crises: Political Intramurals, Oil Shock, and Imperialist War

Center for People’s Empowerment in Governance (CenPEG) Monthly Political Briefer March 2026

Introduction

March 2026 saw an intensifying political polarization in the Philippines in the wake of various corruption scandals and a rapidly deteriorating global security environment after the US and Israel’s attacks on Iran.

Domestically, rival elite factions, principally aligned with the Marcos and Duterte camps, continued to consolidate their respective bases in anticipation of the 2028 national elections. This competition among elite camps intersected with deepening socioeconomic pressures, particularly the sharp escalation of global oil prices triggered by the expanding US-Israel war on Iran.

Internationally, the widening conflict in West Asia not only exposed limits to US and Israeli military dominance but also carried direct implications for Philippine security policy, especially given the country’s expanding role in US military strategy in the Asia-Pacific.

Across these developments, progressive groups and analysts continue to highlight the structural roots of the crisis, pointing to neoliberal economic policies, militarization, and foreign policy subservience as underlying drivers of both domestic instability and external security vulnerability.

Philippine politics

The month was marked by continued tensions between the Marcos administration and the Duterte bloc, with both sides maneuvering strategically ahead of 2028.

Impeachment complaints and counter-allegations, while not yet decisive, served as weapons deployed in a broader political contest rather than purely legal processes. These developments underscored the fragmentation within ruling elites, as alliances formed during the 2022 elections continued to unravel.

The ongoing proceedings at the Hague-based International Criminal Court (ICC) regarding former President Rodrigo Duterte’s “war on drugs” continues to appear as a major political fault line between the two. While Duterte’s allies framed the ICC’s actions as foreign interference, critics and human rights advocates emphasized the need for accountability amid the thousands of documented extrajudicial killings in the context of the former president’s brutal war on illegal drugs. The Marcos Jr. administration maintained a seemingly disinterested stance, asserting Philippine sovereignty while avoiding outright confrontation with international legal institutions, reflecting its balancing act between domestic political considerations and international legitimacy.

Parallel to these elite feuds, progressive politicians and activists continued to face sustained attacks from right-wing groups and the security sector. Red-tagging, legal harassment, and surveillance persisted, contributing to a climate of fear and constraint. Human rights organizations reported ongoing cases of arbitrary arrests, militarization of rural communities in Southern Tagalog, Cagayan Valley and other regions, and violence against activists, particularly in areas with strong peasant and indigenous movements as well as anti-mining campaigns such as that in Dupax del Norte, Nueva Vizcaya.

Mass mobilizations in March reflected growing public discontent. The March 8 International Women’s Day protests drew large crowds, linking gender issues with broader demands for economic justice and human rights as well as an end to US and Israel’s imperialist military intervention in West Asia and the Philippines. Transport strikes staged by jeepney and transport groups, supported by progressive organizations, protested both modernization policies and lack of government response to rising fuel costs. These strikes highlighted the compounded burdens faced by the transport sector as well as the commuting and consumer public. Demonstrations against US military presence in the country under the EDCA system and the war in West Asia, particularly in front of the US Embassy in Manila, underscored the intersection of domestic and international indignations.

National economy

The Philippine economy in March was heavily impacted by the global oil price shock stemming from the escalation of the US-Israel war on Iran. In fact, it is the most affected in the entire Southeast Asian region, having the highest increases in domestic fuel prices. The effects rippled across sectors. Transport operators faced rising operating costs, farmers and fisherfolk grappled with higher input expenses, and consumers experienced broader inflationary pressures.

Public utility jeepney drivers and operators, as well as other workers in the transport sector, were among the hardest hit, with fuel price hikes eroding already precarious incomes. This fueled the transport strikes seen during the month, as operators demanded immediate relief measures. Some operators and drivers, in fact, have notably stopped operations, further exacerbating an already limited transport sector capacity because of government modernization efforts. Similarly, fishers reported reduced fishing activities due to high fuel costs, while farmers warned of sharp declines in local agricultural production due to increased fuel costs.

Progressive groups and advocates advanced several policy proposals to mitigate the crisis. These included the imposition of price controls or ceilings on the prices of oil and basic commodities, the suspension of excise taxes and value-added tax (VAT) on fuel, and the provision of targeted subsidies for vulnerable sectors. These proposals drew from longstanding critiques of the deregulated oil industry, which has limited the government’s capacity to stabilize prices and mitigate the effects of global shocks.

The Marcos administration adopted a cautious and tepid response. Measures included the expansion of fuel subsidies for transport and agriculture, discussions on the possible suspension of certain oil taxes, and passing of an emergency declaration that would give the chief executive the power to regulate prices if necessary. However, these responses were widely viewed as insufficient and reactive, given the dire circumstances, and given the unique opportunity to address longstanding vulnerabilities.

Progressive critics argued that the government’s approach failed to address structural issues, particularly the deregulation of the local downstream oil industry as well as monopoly  pricing mechanisms. They contended that without decisive intervention, such as direct price regulation and the rollback of regressive consumption taxes, the burden of adjustment would continue to fall disproportionately on ordinary Filipinos.

The oil crisis thus exposed the vulnerabilities of the Philippine economic model, particularly its susceptibility to external shocks and its limited policy space under neoliberal frameworks imposed, ultimately, by the US’s Washington ruling political elite.

Global tensions

The escalation of the US-Israel war on Iran dominated international developments in March, with significant implications for global and regional security. In fact, commentators like the American economist Jeffrey Sachs have cautioned that this US-Israel war may be the catalyst to another global war with dire consequences.

Initial US and Israeli strikes aimed at degrading Iran’s military and strategic capabilities have apparently fallen short of their objectives. Iran demonstrated a capacity to absorb the attacks and mount coordinated counteroffensives, including missile and drone strikes targeting US and allied facilities in parts of the Gulf region. Iran has not used its underground and more lethal weapons.

These counterattacks have caught US and Israeli forces off guard, revealing gaps in defense systems and the limits of deterrence. Strikes on strategic installations, including logistics hubs and military bases used by US forces, highlighted Iran’s ability to launch counterattacks beyond its borders. At the same time, Israel faced sustained resistance from Hezbollah in Lebanon, which launched retaliatory attacks along Israel’s northern front.

Iran’s self-defense system has been augmented by China’s modern intelligence installations and Russia’s advanced drones and missiles.

The humanitarian toll of the conflict continued to mount. Civilian populations in Iran and Lebanon suffered deaths in the thousands and displacement in the millions due to ongoing bombardments, while the broader region experienced heightened economic and political instability. These developments unfolded alongside the continuing genocide in Palestine, where Israel’s military operations have drawn widespread condemnation for their devastating impact on civilian life despite the formal ceasefire declaration.

War on Iran, an Indirect Attack on China?

A number of analysts have pointed out that the US-Israel war on Iran effectively functions as an indirect pressure point on US rival China (and, to a lesser extent, Russia). After all, Iran – a key China cooperation partner – occupies a critical position in global energy flows and in China’s Belt and Road corridors, making it central to Beijing’s long-term economic and security architecture. By destabilizing Iran and threatening the Strait of Hormuz, the war disrupts key energy routes that are vital to Asian economies, particularly China’s, while also forcing Beijing to divert attention and resources to crisis management.

While neither Beijing nor Moscow has intervened directly, both have provided diplomatic, logistical, or intelligence support that enables Iran to sustain resistance without triggering a wider great-power war. This dynamic has effectively turned the conflict into a proxy arena, where weakening Iran also means weakening a node in the broader China-Russia strategic network, even as a prolonged war risks overstretching US resources and opening strategic space for both powers elsewhere.

Meanwhile, China’s reported deployment of dozens of research vessels and hundreds of oceanic sensors in deep seas across the Asia-Pacific have indicated a major push to build an integrated undersea surveillance network capable of tracking submarine activity in real time.

By combining seabed sensors, autonomous systems, and environmental data collection, Beijing is working toward what analysts describe as a “transparent ocean,” where the traditional stealth advantage of submarines is significantly reduced. This effort is closely tied to preparations for potential conflict with the US, whose naval strategy relies heavily on submarine superiority.

The implications for the South China Sea are immediate. The region is already a likely site for the deployment of these systems. This would allow China not only to track US submarines but also to closely observe the movements of Philippine vessels. This development could also weaken the credibility of US military deterrence in the region. If China can effectively detect or neutralize US submarines, it alters the balance of power that underpins Philippine reliance on its alliance with Washington.

Amid the increasing regional and global tensions, the Marcos government is on the edge of holding talks the China, a leading trade partner, and has asked Russia for crude energy imports.  

More broadly, the expansion of undersea surveillance signals a shift in the nature of the South China Sea conflict. It is no longer limited to visible confrontations over reefs and shoals but is evolving into a technologically intensive contest over information and detection. For the Philippines, this raises the risk that its surrounding waters become part of a deeper, less visible front in US-China strategic competition, with potential repercussions that extend beyond traditional maritime disputes.

Implications for the Philippines

For the Philippines, the conflict carries direct implications due to its deepening military ties with the United States. Iran’s willingness to target US facilities in allied Gulf countries raised concerns about the potential risks associated with hosting US military assets. While Philippine defense officials sought to downplay these risks, the situation underscored the country’s exposure to external conflicts as a result of its security alignment.

Despite these developments, joint military exercises between the Philippines and the United States, including the Balikatan exercises, proceeded as scheduled. These exercises were framed as necessary for defense preparedness but were criticized by progressive groups as further entrenching Philippine involvement in US strategic objectives.

The conflict also revealed vulnerabilities in Israeli military capabilities, particularly in the face of sustained resistance from Iran and its regional allies. It has challenged prevailing narratives of military dominance and point to more multipolarity in global geopolitics.

These developments also highlight the growing urgency for the Philippine government to prioritize diplomatic, peaceful, and legal approaches in addressing its maritime dispute with China. It also reinforces the need for an independent foreign policy that engages regional neighbors on the basis of national interest, rather than one that simply mirrors or aligns with the strategic priorities of the United States in the region,

In a balancing act, the Marcos government has approached China to negotiate for a joint exploration and development of the South China Sea’s mineral and marine resources. Once implemented, the plan will be a breakthrough in the two countries’ continuing talks since 1988 toward the joint development of the SCS.

Conclusion

March 2026 saw further escalations of domestic political tensions and global geopolitical shifts in shaping the Philippine situation. The intensifying rivalry between the Marcos and Duterte camps reflects not only personal and factional conflicts but also broader struggles over political control in the lead-up to 2028. At the same time, grassroots mobilizations indicate that popular discontent is growing, driven by both political repression and economic hardship.

The oil price shock triggered by the war in West Asia exposed structural weaknesses in the Philippine economy, particularly its vulnerability to external forces because of its deregulated economy, as well as its limited capacity for decisive political and fiscal intervention and the deeply corrupt nature of its governance. Government responses, while providing short-term relief, have yet to address these deeper issues.

Internationally, the evolving US-Israel war on Iran has impacted in the global balance of power, with significant implications for countries like the Philippines that are closely aligned with US military strategy. The risks associated with such alignment are becoming increasingly apparent, as conflicts in distant regions carry the potential to directly affect Philippine national security.

The war between the US-Israel and Iran may open the world system’s new chapter. A humiliating defeat of America will lead to the demise of its pre-eminent hegemony giving way to a full-circle new multipolar global order.

The developments of March 2026 point to a period of heightened uncertainty and contestation. The interplay between elite competition, continuing corruption in government, economic pressures, and imperialist wars will likely continue to shape the Philippine political landscape in the months ahead, demanding careful analysis and strategic engagement from progressive forces. #