From the game's encyclopedia
Situations are medium to long term affairs that involve characters within a geographical Situation Region, switching between different Situation Phases.
The game's text for patch 1.20.1.2. Words in blue are entries of the encyclopedia: hover one to read it, as in the game.
Situation is an entry of Crusader Kings III's in-game encyclopedia. The game explains it: "Situations are medium to long term affairs that involve characters within a geographical Situation Region, switching between different Situation Phases." It covers The Great Steppe, Situation Region, Situation Phase, Participant Group, Situation Catalyst and 1 more. The game also links it as Situations. Patch 1.20.1.2, from game/common/game_concepts/mpo_game_concepts.txt and game/localization/english/game_concepts_l_english.yml.
Source: game/common/game_concepts/mpo_game_concepts.txt, game/localization/english/game_concepts_l_english.yml and the English localisation, Crusader Kings III 1.20.1.2.