"Collateral damage’
Trump’s eight-month war with Iran is causing serious collateral damage to our economy. Oil prices became seriously high, causing our inflation to painfully escalate. Things may even get worse.
Trump said late last week that the US may carry out another military operation against Iran before the mid-term election next week. “We may do another little Epic Fury,” Trump told a rally in Florida, using the US military’s term for its war on Iran.
The US has evacuated 50,000 military troops from over eight major bases in the Middle East and moved all their planes to safer areas. The US State Department removed all non-essential personnel from the different posts in the region. This looks like war preparation.
Increasingly serious geopolitical turbulence that caused severe supply disruptions in the Middle East has already caused extreme volatility into the oil market. Prices have surged significantly, with Brent crude consistently trading above $100 — and recently pushing toward $110 to $113 per barrel.
The breakdown of the US–Iran ceasefire agreement and the prolonged, effective closure of the Strait of Hormuz have removed a massive volume of oil from the market. Recent drone and missile attacks on pipelines and refineries have kept the structural geopolitical risk premium elevated.
The crisis is exacerbated by the ongoing conflict between the Houthi rebels of Yemen and Saudi Arabia. Over the past few weeks, the Houthis have been able to bypass the Kingdom’s multi-billion dollar defense shield, penetrating deeply into major airports and high-value energy facilities.
The Houthis have surprisingly managed to inflict severe damage on Saudi Arabia’s strategic infrastructure, undermining the Kingdom’s economic stability and security.
There have been unprecedented flight cancellations across major airports, notably the King Khalid International Airport (Riyadh). The major airport in the country’s capital has been repeatedly hit since early October.
Thousands of OFWs have been stranded in Manila as flights to Saudi Arabia have been cancelled. But failure to deploy these OFWs may be a blessing in disguise as war clouds darken the Middle East that may require massive evacuation of our workers.
A renewed escalation of the war between the US, Israel and Iran would transform the Middle East into an active war zone. For the nearly two million OFWs across the Gulf, this scenario would trigger a massive humanitarian and economic crisis in the Philippines.
OFWs will face immediate survival threats and catastrophic financial fallout. A mandatory evacuation requires commercial or charter flights to pull workers out. However, if Iran and the Houthis target airports or enforce a regional no-fly zone, airspace will completely close.
OFWs will be trapped on the ground. Air raids, drone interceptions and falling shrapnel would turn major civilian areas in Riyadh, Dubai, Doha and Dammam into highly volatile danger zones.
Displaced US forces are reported to be relocating from ruined American bases into local hotels and civilian office spaces. That means major commercial zones in Gulf cities are now war targets.
If President Trump follows through on direct military intervention in Yemen or a major push against Iran, the Philippine government will be forced to shift from voluntary repatriation to mandatory evacuation.
If that happens, the mass repatriation of nearly a million workers from Saudi Arabia alone would instantly choke the Philippine economy, cut off billions in foreign currency and flood the local market with unemployed labor.
Remittances from the Middle East sustain OFW families back home, with all of those households relying on that cash exclusively for immediate daily survival (food and education). If regional digital infrastructure takes a hit that shuts down banking networks, the domestic economic and political fallout in the Philippines will be immediate.
Top Iranian security officials and the Islamic Revolutionary Guard Corps (IRGC) have explicitly stated that they have drawn up “detailed plans” to target critical internet arteries and US-linked AI/data centers across the Gulf the moment a US or Israeli attack lands on Iranian territory.
According to intelligence sources of The Jerusalem Post, Iran’s IRGC has prepared list coordinates for seven major internet fiber-optic cables running beneath the Strait of Hormuz. Senior Iranian officials warned that if President Trump relaunches the “Epic Fury” campaign or if Iranian oil infrastructure is touched, these cables will be hit simultaneously to choke Gulf economies.
According to Al Jazeera, a top Iranian security chief explicitly designated US-linked digital infrastructure across the Gulf — specifically the massive cloud data centers and AI nodes built by tech giants in the UAE and Saudi Arabia — as active targets. The Houthis have already shown they have precision-drone capability required to inflict damage.
If data centers or subsea fiber-optic cables are disabled, local banking apps and SWIFT networks will go offline. Even if an OFW’s employer wants to pay them, corporate payrolls will freeze.
OFWs will be unable to send money through digital apps. Back home in the Philippines, families who depend on monthly transfers for daily food, medicine and rent will face financial starvation within weeks.
Repairing damaged cables may take years, if Iran allows it at all.
If a war forces a significant portion of the two million OFWs in the Middle East to go back to the Philippines, the domestic economic impact will be devastating.
Cutting off the billions of dollars in annual remittances will cause the Philippine peso to depreciate sharply, drastically driving up the cost of imported goods, electricity and fuel in Manila.
The Philippine local labor market cannot suddenly absorb hundreds of thousands of returning workers. The sudden influx of displaced, unemployed OFWs will heavily strain national social safety nets, livelihood programs and local government resources.
Are our officials already planning ahead on how to respond to these situations before they become real life emergencies? We would be very surprised if they are doing any risk mitigation planning.
If we were Singapore, our officials would be so many steps ahead by now. For us, bahala na!
Boo Chanco’s email address is [email protected]. Follow him on X @boochancio
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