The U.S. Department of State said on Wednesday American government vessels can now transit the Panama Canal without charge fees.

Panama denied a claim made by the State Department on Wednesday that the Central American nation had agreed to no longer charge fees for US government ships to transit the country’s famous canal.

The Panama Canal Authority late Wednesday said it has made no change to its tolls or other fees, denying the Trump administration claim that it has agreed to no longer charge U.S. government vessels for using it.

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.

As President Donald Trump's second administration continued its swift recasting of the federal government and American foreign policy, the president and his top diplomat issued a stunning proposal, saying the U.S. would "take over" the Gaza Strip, "level the site" and rebuild it.

U.S. government vessels are being allowed to transit the Panama Canal without being charged fees, the U.S. Department of State announced Wednesday evening. The big picture: The move comes days after Secretary of State Marco Rubio visited Panama and warned officials there to curb Chinese influence as President Trump seeks to regain control of the Panama Canal.

The Panama Canal Authority on Wednesday denied the U.S. State Department's claim that U.S. government vessels would be able to cross the canal without paying fees, likely ratcheting up tensions after President Donald Trump threatened to take back control of the crossing.