French President Francois Hollande has said reports that the US bugged EU diplomatic missions could threaten crucial free trade talks, despite US efforts to downplay the growing espionage scandal.
Hollande asked the US on Monday to immediately cease spying on European institutions, adding "enough elements have already been gathered for us to ask for explanations" from Washington about the spying allegations.
"There can be no negotiations or transactions in all areas until we have obtained these guarantees, for France but also for all of the European Union, for all partners of the United States," he said.
The French minister of foreign trade, Nicole Bricq, also raised her fears saying "We must absolutely re-establish confidence... it will be difficult to conduct these extremely important negotiations."
Negotiations over creating the world's largest free trade zone between the EU and the US are due to start on July 8 in Washington.
A German government spokesman said if media reports were true, it would be unacceptable Cold War-style behaviour between partners who required trust for a new trans-Atlantic trade area.
Also Chancellor Angela Merkel wanted to discuss the allegations with the US President, Barack Obama.
Greece said it was baffled by the reports of covert surveillance and added that it would request "clarification" if there was any truth behind them.
"(Greece) is unable to grasp information that has come to light regarding surveillance of, among others, Greek diplomatic missions from the services of a friend and ally," foreign ministry spokesman Constantinos Koutras said in statement.
EU security sweep
Meanwhile, the EU has ordered a security sweep of its buildings after the spying allegations.
The Commission called in the US ambassador to the EU, William Kennard, for discussions on the issue with Pierre Vimont, the EU's top diplomat.
Earlier in the day, the US Secretary of State, John Kerry said that he did not know the particulars about allegations that the US bugged European Union offices, and that countries involved in international affairs undertook different activities to protect their national interests.
"Every country in the world that is engaged in international affairs of national security undertakes lots of activities to protect its national security and all kinds of information contributes to that. All I know is that is not unusual for lots of nations. But beyond that I'm not going to comment any further until I have all the facts and find out precisely what the situation is" he added.
The latest revelations from US intelligence whistleblower, Edward Snowden, published in a German magazine Der Spiegel showed that the National Security Agency lists 38 embassies and missions and describes them as "targets".
According to Der Spiegel, the NSA taps half a billion phone calls, emails and text messages in Germany in a typical month, much more than any other European peer.
The list includes the French, Italian and Greek embassies, as well as other US allies including Japan.
The document outlines how the NSA spied on EU internal computer networks in Washington and at the United Nations, not only listening to conversations and phone calls, but also gaining access to documents and emails.
Surveillance methods included planting bugs into encrypted fax machines and other communications equipment.