Oil at $85 by the end of the year: Rothman

Oil gets to $85 by year-end Pro

While market watchers exclaim there's a crude glut, that excess oil is nowhere to be found, according to Cornerstone Analytics' founder.

The expert argues that oil demand has been understated by most measures for the last couple of years. "Even in the just-ended quarter, global oil demand came in about 1 million barrels a day higher than what the consensus believed," Mike Rothman told CNBC's "Power Lunch."

He contends instead that "oil demand grows this year by 1.8 million a day and non-OPEC supply contracts by 800,000," and added that "there's no way that OPEC fills a 2.6 million hole."

On the other hand, the International Energy Agency released an April report stating that growth in global oil demand is declining around 1.2 million barrels per day. The agency said that global oil supply sank in March 0.3 million barrels per day to 96.1 million barrels per day. Similarly, the IEA said on Thursday that non-OPEC production would fall this year more than it has in previous generations.

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In this vein, Rothman suggests that the internationally traded Brent will go for $85 by the end of the year, a number he said the Saudis have been aiming for.

Brent settled down at $44.64 a barrel on Wednesday, while U.S. oil closed down 2 percent at $43.18 on the day. While prices were already lower, news from market intelligence firm Genscape showed a crude build of more than 840,000 barrels, which drove oil prices down further.

The news comes after the oil market managed to rally even after an oil production freeze meeting in Doha failed to strike a deal.

"There are only two real prices in a discussion: what kills supply and what kills demand," he said. "In between is what someone is willing to try to fight or defend, so when the Saudis mention a price, it's something that's critical or you look at their budgets, that tends to become a center of gravity."

— Reuters contributed to this report.