ASEAN Beat | Economy | Southeast Asia

The Philippine’s Strategic Dilemma in the Shadow of Middle East Conflict

The Iran war is not merely an economic shock for the Philippines, it is a strategic stress test of the Marcos Jr. administration’s pro-U.S. alignment. 

On March 6, Philippine President Ferdinand Marcos Jr. acknowledged that Manila is “a victim of a war we did not choose or desire” in an address to the country. Clearly, he was referencing the U.S.-Iran war in the Middle East. Recognizing Manila’s heavy dependence on imported fuel sources, he followed those remarks with a declaration of a national energy emergency, stating that the country’s energy security was in “imminent danger.” 

Marcos Jr.’s statement reveals that the Iran war is not merely an economic shock for the Philippines. Rather, it is a strategic stress test of his administration’s pro-U.S. alignment. While the Marcos administration is pursuing a whole-of-government response to the energy crisis his country faces by leveraging public-private partnerships and providing targeted support to vulnerable sectors, his clear security alignment with Washington risks narrowing Manila’s bargaining space for joint energy cooperation with China. Additionally, fuel limitations may embolden Beijing to adopt a more assertive posture in the South China Sea. 

Simply put, the Iran war is testing Manila’s capacity to sustain its deterrence efforts against China under crisis conditions when Washington’s focus is drifting away from the Indo-Pacific region. 

Since Washington launched Operation Epic Fury against Tehran, Manila has scrambled to respond to the war’s energy fallout. Early concerns over oil access prompted the Philippines to issue Memorandum Circular No. 114, directing government-wide conservation measures. With fuel reserves estimated at around 50 days, Manila has secured “safe and preferential access” from Iran for Manila-flagged vessels passing through the Strait of Hormuz and has sought U.S. sanctions waivers to import oil from restricted sources such as Russia. Together, these measures underscore how the Philippines’ agency is constrained, as it must balance immediate energy needs with alliance expectations.

Additionally, the Philippines’ push to leverage ASEAN for coordinated responses has gained little traction, as member states prioritize domestic energy needs over collective action. At the March 13 ASEAN Economic Ministers’ meeting, partners stopped short of making firm commitments to lift export curbs despite recognizing the need for stronger coordination. Despite chairing ASEAN, Manila’s limited ability to advance regional crude oil-sharing highlights how great-power conflict destabilizes smaller states, forcing them to prioritize national resilience over collective solutions.

The Philippines also faces a parallel challenge in its noncombatant evacuation operations. Tehran’s retaliatory ballistic missile strikes across the Gulf States are forcing thousands of overseas Filipino workers (OFWs) to seek security and repatriation back to the Philippines. On March 23, Manila completed its fourth chartered flight; since March 5, Manila has successfully evacuated over 1,400 OFWs and 334 dependents back to the Philippines. With millions of Filipinos still in the region, Manila’s ability to rapidly execute complex movement and logistical operations reinforces its legitimacy and demonstrates its operational capacity to support citizens in distress. This effort serves as a litmus test of the government’s broader readiness for crisis response.

At home, however, the crisis in the Middle East has generated domestic security anxieties too. Fears that Tehran’s retaliatory strikes could extend to the nine Enhanced Defense Cooperation Agreement (EDCA) sites the U.S. has access to in the Philippines have prompted Manila to clarify the terms of its security arrangements with Washington to protect its people. The Philippines National Security Council (NSC) has taken early action to dispel any local concerns about the connection of the EDCA sites to U.S. operations in the Middle East, dismissing rumors that the EDCA sites will be targeted by Iranian retaliatory strikes. Philippine authorities have urged the public to remain calm and to exercise vigilance against disinformation. A Philippine Department of National Defense spokesperson noted further that some groups are using the Middle East conflict to sow “fear and apprehension” among Filipinos. 

Despite rising anxieties, Manila so far has doubled down on its security alignment with Washington rather than signaling restraint. High-profile engagements continue to portray the alliance as “ironclad.” On March 13, Marcos Jr. met with U.S. defense officials in New York, including Undersecretary of Defense Elbridge Colby; both sides reaffirmed the Mutual Defense Treaty and their commitment to improving interoperability, strengthening deterrence, and deepening military coordination. It’s no secret that these commitments are aimed at deterring Beijing’s salami-slicing tactics and gray-zone activities in the South China Sea and the broader Indo-Pacific. 

These commitments, proactively deepening defense cooperation with Washington, put on display Manila’s assertive shift toward a stronger pro-U.S. military posture. Manila is enabling an expanded U.S. military presence, agreeing to expanded deployment of U.S. troops and long-range strike systems in support of a U.S.-led anti-access/area denial (A2/AD) strategy against Beijing. Capable of targeting China’s coastal provinces, these escalatory actions risk undermining Manila’s diplomatic space with its more powerful neighbor. Furthermore, it complicates any efforts Manila can pursue to cooperate with Beijing on energy security amid the ongoing conflict in the Middle East.  

While taking proactive steps to buttress its alliance with the U.S., Marcos Jr. cannot afford to falter in managing the Philippines’ energy crisis at home. Any failure to deliver will further undermine Manila’s political legitimacy and weaken its bargaining position amid intensifying great-power competition. A recent Pulse Asia survey, which recorded Marcos’ public distrust rating at 44 percent, highlights the fragility of public confidence in his administration. Coupled with a history of unmet economic promises, his inability to stabilize energy supply or mitigate rising costs can deepen domestic dissatisfaction, eroding Manila’s political flexibility in shaping foreign policy, and aggravating domestic vulnerabilities that Beijing could exploit. 

Ultimately, the current challenge Manila faces is not merely an energy crisis. Rather, it is a struggle to navigate a broader strategic dilemma shaped by its choice for a closer alignment with Washington. As the Iran war exposes Manila’s dependence on external energy, this vulnerability has become a key driver of Manila’s strategic choices. How it continues to manage this balance will determine not only its domestic stability but also serve as a test case for whether a pro-U.S. Southeast Asian state can sustain deterrence credibility amid U.S. strategic distraction.

Get to the bottom of the story

Subscribe today and join thousands of diplomats, analysts, policy professionals and business readers who rely on The Diplomat for expert Asia-Pacific coverage.

Get unlimited access to in-depth analysis you won't find anywhere else, from South China Sea tensions to ASEAN diplomacy to India-Pakistan relations. More than 5,000 articles a year.

Unlimited articles and expert analysis

Weekly newsletter with exclusive insights

16-year archive of diplomatic coverage

Ad-free reading on all devices

Support independent journalism

Already have an account? Log in.

On March 6, Philippine President Ferdinand Marcos Jr. acknowledged that Manila is “a victim of a war we did not choose or desire” in an address to the country. Clearly, he was referencing the U.S.-Iran war in the Middle East. Recognizing Manila’s heavy dependence on imported fuel sources, he followed those remarks with a declaration of a national energy emergency, stating that the country’s energy security was in “imminent danger.” 

Marcos Jr.’s statement reveals that the Iran war is not merely an economic shock for the Philippines. Rather, it is a strategic stress test of his administration’s pro-U.S. alignment. While the Marcos administration is pursuing a whole-of-government response to the energy crisis his country faces by leveraging public-private partnerships and providing targeted support to vulnerable sectors, his clear security alignment with Washington risks narrowing Manila’s bargaining space for joint energy cooperation with China. Additionally, fuel limitations may embolden Beijing to adopt a more assertive posture in the South China Sea. 

Simply put, the Iran war is testing Manila’s capacity to sustain its deterrence efforts against China under crisis conditions when Washington’s focus is drifting away from the Indo-Pacific region. 

Since Washington launched Operation Epic Fury against Tehran, Manila has scrambled to respond to the war’s energy fallout. Early concerns over oil access prompted the Philippines to issue Memorandum Circular No. 114, directing government-wide conservation measures. With fuel reserves estimated at around 50 days, Manila has secured “safe and preferential access” from Iran for Manila-flagged vessels passing through the Strait of Hormuz and has sought U.S. sanctions waivers to import oil from restricted sources such as Russia. Together, these measures underscore how the Philippines’ agency is constrained, as it must balance immediate energy needs with alliance expectations.

Additionally, the Philippines’ push to leverage ASEAN for coordinated responses has gained little traction, as member states prioritize domestic energy needs over collective action. At the March 13 ASEAN Economic Ministers’ meeting, partners stopped short of making firm commitments to lift export curbs despite recognizing the need for stronger coordination. Despite chairing ASEAN, Manila’s limited ability to advance regional crude oil-sharing highlights how great-power conflict destabilizes smaller states, forcing them to prioritize national resilience over collective solutions.

The Philippines also faces a parallel challenge in its noncombatant evacuation operations. Tehran’s retaliatory ballistic missile strikes across the Gulf States are forcing thousands of overseas Filipino workers (OFWs) to seek security and repatriation back to the Philippines. On March 23, Manila completed its fourth chartered flight; since March 5, Manila has successfully evacuated over 1,400 OFWs and 334 dependents back to the Philippines. With millions of Filipinos still in the region, Manila’s ability to rapidly execute complex movement and logistical operations reinforces its legitimacy and demonstrates its operational capacity to support citizens in distress. This effort serves as a litmus test of the government’s broader readiness for crisis response.

At home, however, the crisis in the Middle East has generated domestic security anxieties too. Fears that Tehran’s retaliatory strikes could extend to the nine Enhanced Defense Cooperation Agreement (EDCA) sites the U.S. has access to in the Philippines have prompted Manila to clarify the terms of its security arrangements with Washington to protect its people. The Philippines National Security Council (NSC) has taken early action to dispel any local concerns about the connection of the EDCA sites to U.S. operations in the Middle East, dismissing rumors that the EDCA sites will be targeted by Iranian retaliatory strikes. Philippine authorities have urged the public to remain calm and to exercise vigilance against disinformation. A Philippine Department of National Defense spokesperson noted further that some groups are using the Middle East conflict to sow “fear and apprehension” among Filipinos. 

Despite rising anxieties, Manila so far has doubled down on its security alignment with Washington rather than signaling restraint. High-profile engagements continue to portray the alliance as “ironclad.” On March 13, Marcos Jr. met with U.S. defense officials in New York, including Undersecretary of Defense Elbridge Colby; both sides reaffirmed the Mutual Defense Treaty and their commitment to improving interoperability, strengthening deterrence, and deepening military coordination. It’s no secret that these commitments are aimed at deterring Beijing’s salami-slicing tactics and gray-zone activities in the South China Sea and the broader Indo-Pacific. 

These commitments, proactively deepening defense cooperation with Washington, put on display Manila’s assertive shift toward a stronger pro-U.S. military posture. Manila is enabling an expanded U.S. military presence, agreeing to expanded deployment of U.S. troops and long-range strike systems in support of a U.S.-led anti-access/area denial (A2/AD) strategy against Beijing. Capable of targeting China’s coastal provinces, these escalatory actions risk undermining Manila’s diplomatic space with its more powerful neighbor. Furthermore, it complicates any efforts Manila can pursue to cooperate with Beijing on energy security amid the ongoing conflict in the Middle East.  

While taking proactive steps to buttress its alliance with the U.S., Marcos Jr. cannot afford to falter in managing the Philippines’ energy crisis at home. Any failure to deliver will further undermine Manila’s political legitimacy and weaken its bargaining position amid intensifying great-power competition. A recent Pulse Asia survey, which recorded Marcos’ public distrust rating at 44 percent, highlights the fragility of public confidence in his administration. Coupled with a history of unmet economic promises, his inability to stabilize energy supply or mitigate rising costs can deepen domestic dissatisfaction, eroding Manila’s political flexibility in shaping foreign policy, and aggravating domestic vulnerabilities that Beijing could exploit. 

Ultimately, the current challenge Manila faces is not merely an energy crisis. Rather, it is a struggle to navigate a broader strategic dilemma shaped by its choice for a closer alignment with Washington. As the Iran war exposes Manila’s dependence on external energy, this vulnerability has become a key driver of Manila’s strategic choices. How it continues to manage this balance will determine not only its domestic stability but also serve as a test case for whether a pro-U.S. Southeast Asian state can sustain deterrence credibility amid U.S. strategic distraction.

David Dichoso is a research intern at the Institute for Indo-Pacific Security (IIPS). 

Enhanced Defense Cooperation Agreement (EDCA)

Philippines energy security

U.S.-Philippine alliance

U.S.-Philippines EDCA

© The Diplomat