* Front month slid 6 pct Thursday after bearish EIAs * Warm weather on tap for consuming regions * Recent production, drilling rig data supportive * Coming Up: Baker Hughes gas drilling rig data Friday By Eileen Houlihan NEW YORK, June 8 (Reuters) - U.S. natural gas futures were little changed in early trading Friday in the wake of a six percent drop Thursday on higher-than-expected weekly inventory data. Thursday's fall was the biggest one-day slide in more than four months, with nearby futures remaining near a five-week low in the early going Friday. But traders said warmer weather on tap for consuming regions in the Midwest and Northeast should boost cooling demand, while supportive production and gas drilling rig data were both expected to limit more losses. Front-month July natural gas futures on the New York Mercantile Exchange were at $2.284 per million British thermal units in early trade, up 1 cent, but the contract slid as low as $2.231 in electronic trade, the lowest price for a front-month since late April. Futures hit a 3-1/2-month high of $2.759 in mid-May, but traders said the big rise removed gas from favor over coal for power generation. But since posting a 10-year low of $1.902 twice in late April, nearby futures are up 20 percent on signs that record production was finally slowing and demand picking up as more electric utilities switched from coal to gas. BIG STORAGE BUILD ADDS TO BLOATED INVENTORIES Thursday's gas storage report from the U.S. Energy Information Administration showed total domestic gas inventories rose last week by 62 billion cubic feet to 2.877 trillion cubic feet. The build was above Reuters poll expectations for a 56 bcf gain, but it was still below average for an eighth time in nine weeks. The inventory build trimmed the surplus to last year to 713 bcf, or 33 percent, and sliced the excess versus the five-year average, to 687 bcf, or 31 percent. (Storage graphic: link.reuters.com/mup44s) Strong utility demand for gas has slowed inventory builds, pulling the surplus to last year down 20 percent from late March highs. But with stocks still at record highs for this time of year, there are still concerns that the storage glut will drive prices lower this summer as storage caverns fill up. The storage surplus to last year will have to be cut by at least another 465 bcf to avoid breaching the government's 4.1-tcf estimate of capacity. Stocks peaked last year in November at a record high of 3.852 tcf. Early injection estimates for next week's EIA report range from 64 bcf to 80 bcf versus last year's adjusted build of 72 bcf and a five-year average increase for that week of 88 bcf. PRODUCTION FALLING FROM RECORD EIA data last week also showed gas production was finally dropping from January's record high, with two straight monthly declines. The EIA said U.S. natural gas production fell 0.4 percent in March to 71.76 bcf as producers continued to scale back drilling in the face of low prices. It was a second monthly decline after a revised 1 percent fall in February. In addition, Baker Hughes data on Friday showed the gas-directed rig count fell by six to a 12-1/2 year low of 588. The 37 percent drop in dry gas drilling - since peaking at 936 in October - has stirred talk producers were finally getting serious about stemming the flood of supplies. But the shift away from dry gas to higher-value shale oil and shale gas liquid plays still produces plenty of associated gas that ends up in the market after processing. That has slowed the overall drop in dry gas output. (Rig graphic: r.reuters.com/dyb62s) MORE FUNDAMENTALS The National Weather Service's six- to 10-day outlook issued on Thursday again called for above-normal readings for much of the nation, with normal or below-normal readings in Florida and in the West. Nuclear power plant outages were running at about 14,100 megawatts, or 14 percent, on Friday, down from about 14,700 MW out a year ago but up from a five-year outage rate of about 9,600 MW. (Reporting by Eileen Houlihan; Editing by John Picinich)

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