Main factor is whether or not I can use this city to build a canal.
I'm assuming you want a way to get around that pesky iceberg blocking passage. More on that below...
What would the Panama Canal actually do?
The panama canal will build the wonder tile on the green tile, and it will place a canal district on the rice tile just below it. (It will most likely hook up to the dock in the cumae city tile.) This will effectively give you a waterway around the ice blockage. If global warming is happening, that ice will probably melt soon, though. (Once tiles are permanently lost to sea rise, you can sail on them.) By the way, if you make a 3 tile panama canal in other situations, it has to be 3 tiles in a straight line - it can't make a little arc. (Even though a city with canals on each side could do that.)
Is it possible to create a canal connecting east to west?
So canals can only go on flat land. This is also true of the panama canal and its 2-3 tiles. If that horse resource next to rome wasn't there, for example, rome could have built the panama canal directly across the peninsula, emptying out where the lumbermill is.
However, since you have some districts and such, and existing city placement, your only option is the panama canal where shown, if you want to get around the ice.
Suppose cumae was on the Mine tile directly below it; then it would be able to build a normal canal district on the rice, and another one either where the city is now, or over the lumbermill. (You can only build 2 canals per city.)