PANAMA CITY, Panama--Soldiers in battle gear ringed U.S. military bases near the tense capital yesterday following the fatal shooting of an American officer in the worst confrontation between Panama and the United States in 25 years.

Panamanian soldiers used trucks and buses to block streets leading to Gen. Manuel Antonio Noriega's headquarters.

The Panamanian Defense Forces accused U.S. officers of a provocation without mentioning the American's death Saturday night.

According to a U.S. Southern Command statement, the officer was "off duty, unarmed and in civilian clothes when he and three others were stopped by Panamanian soldiers near the Defense Headquarters in the old section of Panama City."

The Panamanians tried to drag the Americans out of their car and the Panamanians fired at them as they drove off, killing one officer, the statement said. His identity was with-held, pending notification of relatives.

The U.S. officers were in the area because they made a wrong turn and were lost, said Col. Ronald Sconyers, a Southern Command spokesperson.

The Panamanian statement said the U.S. officers had "broken through checkpoints and fired at the headquarters building, wounding a soldier and two civilians, including a one-year-old girl."

President Bush was informed of the situation by National Security Adviser Brent Scowcroft, White House deputy press secretary Roman Popadiuk said in Washington.

"We deplore this act of violence. We are presently looking into the circumstances of this incident," Popadiuk said. "The Noriega regime is isolated both domestically and internationally and has been using force and intimidation to thwart the will of the Panamanian people. Acts such as those of last evening are the consequence of such a regime."

Maj. Shelley Rogers, a Pentagon spokesperson, said Secretary of Defense Dick Cheney had attended a Pentagon briefing on the confrontation.

World of the death and rumors of U.S. retaliation spread quickly. Yesterday morning people at a gas station discussed what the United States might do and spoke of the imminent "arrival of the Americans."

U.S. soldiers mobilized along the perimeters of U.S. installations a few miles northwest of Panama City. Lines of armored personnel carriers and trucks stood at the ready inside the boundary of Fort Clayton.

Combat units were not seen at U.S. bases closer to Panama City, including U.S. Southern Command headquarters at Quarry Heights, which borders the capital to the west.

The 12,000 U.S. troops stationed in the Panama Canal area were restricted to base and only authorized movement was permitted.

A golf course at Fort Amador, a base shared by U.S. and Panamanian military units, was deserted yesterday. A causeway where Panamanians picnic near the fort was empty except for a salsa group rehearsing.

The nearby Bridge of the Americas across thePanama Canal was open.

Panama's opposition leaders refused to commentdirectly about the shooting, saying theinformation they had received was "confusing."

But Christian Democrat leader Ricardo AriasCalderon said the confrontation was the result ofother clashes between Panama and the United Statesin recent months