Ansible: Failed to connect to the host via ssh - ssh

Question

I created a SSH key-pair using the following command:
ssh-keygen -t rsa -C "remote-user" -b 4096
I saved the key pair inside ~/.ssh directory of my local computer:
-rw------- 1 steve.rogers INTRA\users 3381 Jan 18 16:52 remote-user
-rw------- 1 steve.rogers INTRA\users 742 Jan 18 16:52 remote-user.pub
I have an instance in GCP and I have added the above public_key for the user remote_user to it.
After that I tried to SSH into the instance using the following command:
ssh -i ~/.ssh/remote-user remote-user#<gcp-instance-ip>
I was successfully able to ssh into the machine.
After that I tried to execute my playbook:
ansible-playbook setup.yaml --tags "mytag" --extra-vars "env=stg" -i /environments/stg/hosts
The execution did not succeed and ended up with the following error:
<gcp-server102> ESTABLISH SSH CONNECTION FOR USER: None
<gcp-server102> SSH: EXEC ssh -o ControlPersist=15m -F ssh.config -q -o StrictHostKeyChecking=no -o KbdInteractiveAuthentication=no -o PreferredAuthentications=gssapi-with-mic,gssapi-keyex,hostbased,publickey -o PasswordAuthentication=no -o ConnectTimeout=10 -o ControlPath=/Users/steve.rogers/.ansible/cp/7be59d33ab gcp-server102 '/bin/sh -c '"'"'echo ~ && sleep 0'"'"''
Read vars_file './environments/{{env}}/group_vars/all.yaml'
<gcp-server101> ESTABLISH SSH CONNECTION FOR USER: None
<gcp-server101> SSH: EXEC ssh -o ControlPersist=15m -F ssh.config -q -o StrictHostKeyChecking=no -o KbdInteractiveAuthentication=no -o PreferredAuthentications=gssapi-with-mic,gssapi-keyex,hostbased,publickey -o PasswordAuthentication=no -o ConnectTimeout=10 -o ControlPath=/Users/steve.rogers/.ansible/cp/6a68673873 gcp-server101 '/bin/sh -c '"'"'echo ~ && sleep 0'"'"''
Read vars_file './environments/{{env}}/group_vars/all.yaml'
<gcp-server201> ESTABLISH SSH CONNECTION FOR USER: None
<gcp-server201> SSH: EXEC ssh -o ControlPersist=15m -F ssh.config -q -o StrictHostKeyChecking=no -o KbdInteractiveAuthentication=no -o PreferredAuthentications=gssapi-with-mic,gssapi-keyex,hostbased,publickey -o PasswordAuthentication=no -o ConnectTimeout=10 -o ControlPath=/Users/steve.rogers/.ansible/cp/e330878269 gcp-server201 '/bin/sh -c '"'"'echo ~ && sleep 0'"'"''
<gcp-server202> ESTABLISH SSH CONNECTION FOR USER: None
<gcp-server202> SSH: EXEC ssh -o ControlPersist=15m -F ssh.config -q -o StrictHostKeyChecking=no -o KbdInteractiveAuthentication=no -o PreferredAuthentications=gssapi-with-mic,gssapi-keyex,hostbased,publickey -o PasswordAuthentication=no -o ConnectTimeout=10 -o ControlPath=/Users/steve.rogers/.ansible/cp/6f7ebc0471 gcp-server202 '/bin/sh -c '"'"'echo ~ && sleep 0'"'"''
<gcp-server102> (255, b'', b'remote-user#<gcp-instance-ip>: Permission denied (publickey).\r\n')
<gcp-server101> (255, b'', b'remote-user#<gcp-instance-ip>: Permission denied (publickey).\r\n')
fatal: [gcp-server102]: UNREACHABLE! => {
"changed": false,
"msg": "Failed to connect to the host via ssh: remote-user#<gcp-instance-ip>: Permission denied (publickey).",
"unreachable": true
}
fatal: [gcp-server101]: UNREACHABLE! => {
"changed": false,
"msg": "Failed to connect to the host via ssh: remote-user#<gcp-instance-ip>: Permission denied (publickey).",
"unreachable": true
}
<gcp-server202> (255, b'', b'remote-user#<gcp-instance-ip>: Permission denied (publickey).\r\n')
<gcp-server201> (255, b'', b'remote-user#<gcp-instance-ip>: Permission denied (publickey).\r\n')
fatal: [gcp-server202]: UNREACHABLE! => {
"changed": false,
"msg": "Failed to connect to the host via ssh: remote-user#<gcp-instance-ip>: Permission denied (publickey).",
"unreachable": true
}
fatal: [gcp-server201]: UNREACHABLE! => {
"changed": false,
"msg": "Failed to connect to the host via ssh: remote-user#<gcp-instance-ip>: Permission denied (publickey).",
"unreachable": true
}
I sshed into the gcp_instance and checked the authorized_keys file and it contains the correct public_key for the remote_user.
These are my ssh.config, ansible.cfg and host files:
ssh.config:
Host bastion-host
User remote-user
HostName <gcp-instance-ip>
ProxyCommand none
IdentityFile ~/.ssh/remote-user
BatchMode yes
PasswordAuthentication no
Host gcp-server*
ServerAliveInterval 60
TCPKeepAlive yes
ProxyCommand ssh -q -A remote-user#<gcp-instance-ip> nc %h %p
ControlMaster auto
ControlPersist 8h
User remote-user
IdentityFile ~/.ssh/remote-user
ansible.cfg:
[ssh_connection]
ssh_args = -o ControlPersist=15m -F ssh.config -q
scp_if_ssh = True
[defaults]
host_key_checking = False
host
[gcp_instance]
gcp_instance01
[gcp_instance:children]
gcp_instance_level_01
gcp_instance_level_02
[gcp_instance_level_01]
gcp-server102
gcp-server101
[gcp_instance_level_02]
gcp-server201
gcp-server202
What could be the issue that is preventing my playbook from executing?