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.

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