The Mekhilta makes a careful distinction in the verse "There fell upon them dread and terror" (Exodus 15:16). "Dread" fell upon the distant nations. "Terror" fell upon the near ones. The two words are not synonyms — they describe different intensities of fear calibrated to proximity.
The proof comes from the book of Joshua (Joshua 5:1): "And it was when all the kings of the Emori on the western side of the Jordan and all the kings of the Canaanites by the sea heard." The Emori, living just across the Jordan, were the near ones — they experienced terror, the more immediate and visceral fear. The Canaanites by the Mediterranean coast, further away, experienced dread — a more abstract, existential anxiety.
Then the midrash (rabbinic interpretive commentary) brings Rachav, the woman of Jericho, as a witness. She told Joshua's messengers (Joshua 2:10-11): "For we have heard that the Lord dried up the waters of the Red Sea." And she concluded: "The Lord your God, He is God in the heavens above and on the earth below." Rachav's testimony confirms that the news of the Red Sea crossing had penetrated even into the heart of fortified Jericho.
The rabbis understood fear as geography. Distance from Israel determined the flavor of your terror. But no distance was far enough to escape the dread entirely.