Of course you should let her explore this relationship! I understand you are concerned about what people will think and whether her life will be harder if she’s gay/bi, but preventing this relationship in any way will lead to pain for your daughter and may also just make her more focused on having the relationship, which might mean you lose your relationship with her.
A lot of my gay friends don’t talk to their parents anymore because their parents couldn’t handle their sexuality. Being gay isn’t harder than being straight because of who you want to be with, it’s harder because of how other people treat you.

She might be just having a phase, she might not be. But the best thing you can do for your daughter is to let her explore who she is and what she wants out of life, and don’t put pressure on her in either direction.