Geopolitical risks rarely announce themselves gradually. They escalate quickly.

Renewed strikes involving US and Israeli forces and Iran have heightened concerns about energy supply disruptions. Dubai crude prices have risen sharply year to date, amplifying inflation sensitivity across emerging markets.

Oil feeds directly into transportation, logistics, food production, and consumer prices. For central banks considering easing, rising crude complicates policy flexibility.

Bond markets have responded cautiously, with safe haven flows pushing yields lower. Yet a prolonged conflict could reverse that dynamic if inflation expectations climb.

For the Philippines, which imports a significant portion of its energy needs, sustained oil price increases would feed into inflation and pressure household spending.

Markets are currently pricing contained disruption. But geopolitical risk is inherently unpredictable.

Energy volatility remains one of the most significant external variables shaping 2026 macro outcomes.