In the
Dark Sun campaign setting, the city-state of Tyr is presented as on the brink of some drastic change. The Sorcerer-King Kalak has confiscated the slaves of the nobles to build his ziggurat, is taxing the people unmercifully to pay for it, and is neglecting his trade obligations to neighboring states. Kalak's reasons for doing this and the results of his actions for for his city play out in the novel
The Verdant Passage and in the module
Freedom.
In canon, revolution comes to Tyr as Kalak tries to bootstrap himself into dragonhood, and he's thwarted and killed. These events are reflected in the descriptions of Tyr in the revised campaign setting and the 4e Dark Sun setting book.
There are a few other interesting tidbits regarding Tyr. It has the only iron mines in the region. It has a Senate made up of the city nobles that are marginalized and at odds with Kalak's templar bureaucracy. Kalak keeps the still-living, severed heads of former allies Sacha and Wyan around to advise him, and they live on blood. (There is some discrepancy about who Sacha and Wyan are/were. Verdant Passage has Kalak claim they were chieftains that helped him conquered Tyr, and Sacha is presented as the progenitor of the Mericles noble house. In both later novels and rpg material, they are fellow "champions of Rajaat" killed by the dragon.)
Metaplot aside, resolving "Tyr as powder keg" too quickly in the line feels like a misstep to me. I would drag this out, let PCs get involved with the interplay of the factions. Even if they have no desire to become revolutionaries, there's a lot of interesting gameplay that could be wrung from this, whether the players approach it like Yojimbo or just work to avoid it.
I would ditch the name "the Senate" (too much Roman association) but keep the oligarchy as a faction, maybe remaining it the Council or Supreme Council (which the chief governmental body of Carthage was called) or even "The Mighty Ones" (the literal translation of the council advising Phoenician kings).
I love Kalak's plan to jumpstart himself into a dragon, so that has to stay. I also think the severed head advisors are a great touch. I would borrow a bit from Clark Ashton Smith's "The Empire of the Necromancers" and say that Sacha and Wyan (I would change those names, too) were sorcerers and colleagues of Kalak who all came together to the village of Tyr, which at that time was in a small, marshy, wetland amid the ruins of a more ancient city. The three built the city, perhaps with undead labor, but eventually Kalak betrayed and killed the other two.