President Bush is keeping his options open on how to deal with Panama once it holds its election, which U.S. officials predict will be rife with fraud.

Bush on Tuesday urged Panama's neighbors and U.S. allies in Europe to "speak out against election fraud in Panama" as he stepped up the rhetoric against the country's de facto ruler, Gen. Manuel Antonio Noriega.Bush's advisers have been working on policy options to employ after Sunday's election, and no option has been ruled out, said a State Department official.

However, this official and others have acknowledged that one possibility is remote - that of military intervention by the United States, which maintains a hefty military presence along the Panama Canal.

They also say there is scant chance the United States will renew the offer it made to Noriega a year ago - to abandon federal drug-trafficking charges against him if he leaves Panama. Noriega has been indicted by a federal grand jury in Florida.

The drug case began the slide in the once-cozy U.S.-Panama relationship. Economic and trade sanctions instituted last year under President Ronald Reagan have been extended by Bush but have failed to loosen Noriega's grip on the country.

On Tuesday, the president told a Latin-oriented business group, the Council of the Americas, that, "It is evident that the regime is ready to resort to massive election fraud in order to remain in power. The Noriega regime continues to threaten and intimidate Panamanians who believe in democracy.

"The United States will not recognize the results of a fraudulent election engineered simply to keep Noriega in power."

While attempting to discredit the election ahead of time by saying that Noriega has rigged it to ensure victory for his presidential candidate, Carlos Duque, the administration has not declared what post-election pressures it might bring to bear.