Awkward situation moderate conservatives reversed (4)
I believe the answer is:
stew
'awkward situation' is the definition.
'moderate conservatives reversed' is the wordplay.
'moderate conservatives' becomes 'wets' (term used by Margaret Thatcher).
'reversed' shows that the letters should be reversed in order.
'wets' reversed gives 'STEW'.
(Other definitions for stew that I've seen before include "Get anxious" , "A hole, a fix" , "Slow cooked meat dish" , "Agitated state" , "Agitation caused by worry" .)