UPDATE 3-U.S. natgas futures end down slightly after 18-mth high

Thu Mar 21, 2013 3:57pm EDT
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* Inventory draw short of expectations, first time in 5 weeks

* Front month hits highest since September 2011, then slips

* Cold to continue through March and into early April

* Coming up: Baker Hughes rig data, CFTC trade data Friday

By Joe Silha

NEW YORK, March 21 (Reuters) - U.S. natural gas futures ended lower on Thursday for a second straight day but the front-month contract still managed to post an 18-month high despite a government report showing a smaller-than-expected decline in inventories last week.

A U.S. Energy Information Administration report showed total domestic gas inventories fell last week by 62 billion cubic feet to 1.876 trillion cubic feet. EIA said reclassifications from base gas to working gas resulted in a 4 bcf increase in working gas stocks in the Producing Region.

Most traders viewed the decline as bearish for prices, noting it was the first time in five weeks that the draw fell short of expectations. A Reuters poll on Wednesday showed traders and analysts had forecast a 70 bcf drop.

"This week's report ... was bearish relative to street expectations," said Mike Tran at CIBC Global World Markets.   Continued...