Answer:
It creates a mood of despair and surrender.
Step-by-step explanation:
This is the best explanation of why the author would employ the word "panic" in these lines. In this passage, we learn about the problems that the men have in the camp. One of this is the fact that people close to them are hunting. Because of this, there are noises and screams that scare the dogs and make them panic, with the men being unable to do much. This shows the mood of despair and surrender that reigned at these moments.