Natural gas futures traded sharply lower Thursday morning after the Energy Information Administration (EIA) reported a highly anomalous storage withdrawal that was far less than what traders were expecting.

EIA reported a 49 Bcf storage withdrawal in its 10:30 a.m. EST release, whereas traders were expecting a pull about 30 Bcf greater. February futures reached a low of $3.172 immediately after the figures were released, and by 10:45 a.m. February was trading at $3.199, down 6.8 cents from Wednesday's settlement.

"The number sent the market aggressively lower, but it’s attempting to recover those initial losses," said a New York floor trader.

"It was a real shocker to the market," said Steve Blair, vice president at Rafferty Technical Research in New York. "I was surprised the market bounced back a little bit."

Tim Evans at Citi Futures Perspective said he "think[s] reduced demand over the holidays played a key role in the small decline for last week and anticipate[s] a significant rebound in the rate going forward. We'll see how quickly the market may pivot from the bearish data for last week to the prospect of stronger numbers going forward."

Inventories now stand at 3,311 Bcf and are 364 Bcf less than last year and 21 Bcf less than the five-year average. In the East Region 20 Bcf was withdrawn and the Midwest Region saw inventories decrease by 25 Bcf. Stocks in the Mountain Region fell 10 Bcf, and the Pacific Region was down 8 Bcf. The South Central Region added 14 Bcf.

Salt Cavern storage rose 19 Bcf to 343 Bcf and non-salt storage was lower by 5 Bcf to 828 Bcf.