Medecins Sans Frontieres say Panama were pressurised by Italy into the move.
ADVERTISEMENTJust hours after Panama revoked registration of the rescue ship Aquarius, Euronews spoke to a representative from Medecins Sans Frontieres - who is on board the vessel.
The move means there will be no charity rescue ships off the Libyan coast in the near future unless the vessel can find a new flag to sail under.
Aquarius 2, the one remaining charity rescue vessel still operating in the Central Mediterranean area, has 58 survivors on board.
"We are really focused with the operations at sea." said Aloys Vimard Project Coordinator for MSF on board Aquarius. "We didn't receive this email on the ship but clearly it's due to political and economic pressure from the Italian government. This is terrible for us because it means it will take time. If this is confirmed, this will take time for the Aquarius to get a new flag and time is life that will be lost at sea"
Vimard says he "understood" that Italy - told Panamanian authorities that if they don't revoke the registration of Aquarius - Italy would close its ports to Panamanian ships.
"What I know that is stated in the communication is that to have the Aquarius registered in Panama was not in the interest in the national interest of Panama what I understood is maybe Italian authorities said they would close ports for Panamanian ships. This is something that I heard - that there was some pressure somehow, this is not something that I read."
Italy's Interior Minister Matteo Salvini said the Italian government had applied no pressure on Panama.
Panama has also denied any pressure from Italy.
Meanwhile, Vimard says the Aquarius 2 has enough food supplies to remain at sea for a long period of time if needed.