Panama President José Raúl Mulino has rejected the U.S. State Department’s claim that his country had reached a deal allowing U.S. warships to transit the Panama Canal for free.

The State Department claimed it had struck a deal that would save the U.S. government “millions of dollars a year.”

Panama President Jose Raul Mulino on Thursday accused the United States government of lying a day earlier when the U.S. State Department claimed that U.S. government vessels would be able to cross the country's namesake canal without paying fees.

The United States Department of State on Wednesday said American government vessels can now transit the Panama Canal without charge fees. The Department said this in a tweet via its X account. “The government of Panama has agreed to no longer charge fees for U.

Secretary of State Marco Rubio on Thursday said it was "absurd" that U.S. government ships are charged to use the Panama Canal after Panama denied a claim that it had agreed to allow them free traversal.

The Panama Canal Authority said in a statement late on Wednesday that it had not made any changes to charges or rights to cross the canal, after the U.S. State Department said that U.S. government vessels could transit the crossing without being subject to such fees.

Panama President José Raúl Mulino has accused the US of spreading "lies and falsehoods" after the US State Department claimed American government vessels were no longer required to pay a fee to transit through the Panama Canal.