Caley controlled the game for long periods but Steven Thompson's late header secured three points for the Buddies.
Billy McKay's penalty just before the break had earlier cancelled out Esmael Goncalves' opener for the home side.
"It was very hard to take," said Butcher, who must now pick his side up for Saturday's Scottish Cup clash with Kilmarnock.
"We dominated the game from around the 25th minute and we are very disappointed we haven't managed to score a second goal from all the possession we had.
"It is our first loss in the league in some time and we have played much worse and lost - I would be concerned if we had played badly, however that wasn't the case."