A cold European winter and Covid-19 cargo cancellations in the US are supporting LNG carrier rates, setting up a strong 2021 Flex LNG chief executive Oystein Kalleklev said on Thursday.

Speaking at an Arctic Securities webinar — entitled "Shipping - Sailing into a new supercycle?" — Kalleklev said Fearnleys assessed one-year time charter equivalent rates at $72,000 per day as European LNG inventory levels slipped to 30% from 56% year over year.

"Tighter spot market, better fundamentals for the gas prices, better outlook," he said. "We have a much firmer market for gas prices this year."

Last year saw LNG carrier rates skyrocket from $20,000 per day in the summer to six figures by October, rates Kalleklev said he had never seen before, followed by higher cargo prices brought on by a cold winter in both Asia and Europe.

The market cooled off in February, but picked up in mid-March.

Kalleklev said April is usually the month with the lowest LNG demand, but this year, charterers are having a hard time finding a ship.

In addition to building inventories in Europe, Chinese buyers are even looking to secure cargoes as they are now worried they could be caught short in the winter, he said.

More Panama Canal congestion, which was supportive of rates for both LNG and LPG carriers over the winter, could boost all this, Kalleklev predicted.

His comments come after Flex LNG announced a deal with Cheniere Energy to charter the 174,000-cbm newbuilding Flex Vigilant when it leaves the yard in May, followed by two more ships in the third quarter and a fourth in the third quarter of 2022. All four will be in Cheniere's employ for three to three and a half years.

The Houston energy giant also has the opportunity to charter a fifth ship in the third quarter of 2022.

The move into the period market from spot business was one Flex had been hoping to make for some time, Kalleklev said during the webinar.

He said Cheniere has large parcels that need to go long distances.

"The ships we have, the most efficient ships, they are the ideal ships for this kind of trade," he said during Thursday's event.

"If you want to transport these cargoes, these are the ships you want to use."