* WTI in technical market bear, down 20 pct from 2016 high
* Genscape reports near 328,000 barrels Cushing build -traders
* Oil company earnings hit by low prices, weak margins
* Goldman says believes in $40-$45 range through mid-2017 (Updates prices, adds WTI's move into bear market territory after 20 pct drop from 2016 high)
By Barani Krishnan
NEW YORK, July 28 (Reuters) - Oil prices fell nearly 2 percent on Thursday, hitting three-month lows, after a fresh stock build at the delivery hub for U.S. crude futures added to concerns that producers were pumping more than needed.
Surplus barrels of gasoline have already made the glut developing this year more worrisome to some than the crude oversupply of the past two years that had halved prices. U.S. Gulf Coast gasoline stocks hit record highs last week for a July month, while East Coast inventories reached all-time peaks, government data showed on Wednesday. EIA/S
Market intelligence firm Genscape added to the bearish sentiment on Thursday, reporting a build of nearly 328,000 barrels at the Cushing, Oklahoma delivery hub for U.S. crude futures during the week to July 26, traders who saw the data told Reuters.
U.S. crude's West Texas Intermediate (WTI) futures fell 63 cents, or 1.5 percent, to $41.29 a barrel by 11:48 a.m. EDT (1548 GMT). WTI earlier fell to $41.21, its lowest since April 20. WTI has lost 20 percent from its 2016 high of $51.67 on June 9, technically placing it in bear market territory.
Brent crude futures LCOc1 were down 73 cents, or 1.7 percent, at $42.74, after falling earlier to $42.71, the lowest since April 19.
Oil prices are still up about 60 percent from 12-year lows of $26-$27 in the first quarter. But the rally has faded since they breached $50 in May.
"Our price target right now is $38 for WTI," said Matthew Tuttle, chief executive of Tuttle Tactical Management in Riverside, Connecticut. "We think there's more to go on the downside because the move that we saw up to $50 was fundamentally-driven but that created more supply."
Oil companies have also reported lower earnings lately, hit by refining margins.
Energy major Royal Dutch Shell RDSa.L reported a more than 70 percent fall in quarterly profit on Thursday, well below analysts' estimates. Rivals BP BP.L and Statoil STL.OL have also reported worse-than-expected second-quarter results. have a more optimistic view on oil.
Analysts at Goldman Sachs (NYSE:GS) forecast a $45-$50 price range through mid-2017, based on their forward assessment of oil's supply-and-demand balance.
"It is important to emphasize that while timespreads weakened as oil prices declined last month, the recent move lower in oil prices has occurred alongside relatively stable timespreads," Goldman's analysts said in a note.