A powerful explosion near a major bridge close to the Panama Canal has triggered panic, with dramatic footage showing vehicles speeding away from flames and thick smoke rising into the sky.

Panamanian authorities on Thursday searched a local ports unit of Hong Kong conglomerate CK Hutchison Holdings, according to a source familiar with the matter, intensifying tensions over control of two key ports along the strategic Panama Canal.

Panama has formally revoked key port concession contracts held by a subsidiary of Hong Kong-based CK Hutchison and transferred interim operational control of two major canal terminals to global shipping groups A.P. Moller-Maersk and Mediterranean Shipping Co. (MSC).

China is reportedly among the parties interested in bidding to construct two new ports on the Panama Canal, the canal’s administrator said, despite US discussions about reclaiming control of the strategic waterway.

The Chinese government has accused the U.S. of "blackmail" after U.S. Defense Secretary Pete Hegseth labeled Beijing a threat to the Panama Canal, asserting that Washington, along with Panama, "will take back" the waterway from Chinese influence.

U.S. Defense Secretary Pete Hegseth stated on Wednesday that Panama should secure the Panama Canal with support from the United States, rather than China.

U.S. Defense Secretary Pete Hegseth warned on Tuesday during a visit to Panama that the United States will not permit China to undermine the operations of the country's crucial interoceanic canal.

The Panama Canal is exploring the construction of a pipeline to move liquefied petroleum gas (LPG) across the trade passage, canal administrator Ricaurte Vasquez said on Monday, with Japan seen as a top potential client for gas coming from the United States.

Editor's note: Dr. Ricardo Martins. He lives in the Netherlands. He is a specialist in Geopolitics and International Relations by training and hold a PhD in Sociology with a focus on policy and international relations. The article expresses the personal opinion of the author and may not coincide with the view of News.Az.

Panama has denied claims that it has made changes to allow US government vessels to transit the Panama Canal free of charge, following a statement from the White House suggesting an agreement on the matter.