UNL Swings to 9-Month Profit Amidst Asset Decline

Ticker: UNL · Form: 10-Q · Filed: Nov 7, 2025 · CIK: 1405513

Sentiment: bearish

Topics: Natural Gas Futures, Commodity ETF, Asset Contraction, Net Asset Value, Investor Outflows, Futures Trading, Energy Market

Related Tickers: UNG, USO, USL, UGA, BNO

TL;DR

**UNL is shrinking fast, and while it eked out a 9-month profit, the asset drain and quarterly loss signal rough waters ahead for natural gas exposure.**

AI Summary

United States 12 Month Natural Gas Fund, LP (UNL) reported a net loss of $1,348,433 for the three months ended September 30, 2025, a significant increase from the $596,136 net loss in the same period of 2024. However, for the nine months ended September 30, 2025, UNL posted a net income of $453,047, a turnaround from the $1,696,155 net loss in the prior year. This nine-month improvement was driven by a realized gain of $2,119,553 on closed commodity futures contracts, despite a change in unrealized gain (loss) on open commodity futures contracts of -$1,929,554. Total assets decreased to $10,530,344 as of September 30, 2025, from $19,045,543 at December 31, 2024, primarily due to a reduction in cash and cash equivalents from $17,860,450 to $9,634,263. Limited Partners' capital also declined from $18,672,121 to $10,445,121, with outstanding shares decreasing from 2,300,000 to 1,350,000. The net asset value per share fell from $8.12 to $7.74.

Why It Matters

This filing reveals a significant contraction in UNL's asset base and outstanding shares, which could impact liquidity and market depth for investors. While the nine-month net income is a positive, the substantial quarterly loss and overall asset reduction suggest a challenging environment for natural gas futures. Investors should be wary of the fund's ability to effectively track the underlying commodity given these shifts. Competitively, other natural gas ETFs might offer more stability or better tracking, making UNL a less attractive option for those seeking direct exposure to natural gas prices.

Risk Assessment

Risk Level: high — The fund experienced a substantial decrease in total assets from $19,045,543 at December 31, 2024, to $10,530,344 at September 30, 2025, representing a 44.8% decline. This significant reduction, coupled with a 41.2% decrease in limited partner shares outstanding from 2,300,000 to 1,350,000, indicates considerable investor outflows and potential liquidity concerns, increasing the risk for remaining shareholders.

Analyst Insight

Investors should consider reducing or exiting their positions in UNL due to the significant decline in assets and shares outstanding, which could lead to reduced liquidity and increased tracking error. Reallocate capital to more stable or larger natural gas ETFs, or consider direct exposure to natural gas futures if comfortable with higher risk and direct management.

Financial Highlights

debt To Equity
N/A
revenue
N/A
operating Margin
N/A
total Assets
$10,530,344
total Debt
$85,223
net Income
$453,047
eps
N/A
gross Margin
N/A
cash Position
$9,634,263
revenue Growth
N/A

Key Numbers

Key Players & Entities

FAQ

What caused the significant decrease in United States 12 Month Natural Gas Fund, LP's total assets?

The total assets of UNL decreased from $19,045,543 at December 31, 2024, to $10,530,344 at September 30, 2025, primarily due to a reduction in cash and cash equivalents from $17,860,450 to $9,634,263, and substantial redemptions of partnership shares totaling $10,942,176 during the nine months ended September 30, 2025.

How did UNL's net income for the nine months ended September 30, 2025, compare to the previous year?

For the nine months ended September 30, 2025, UNL reported a net income of $453,047, which is a significant improvement compared to the net loss of $1,696,155 reported for the same period in 2024.

What was the net asset value per share for UNL as of September 30, 2025?

As of September 30, 2025, the net asset value per share for UNL was $7.74, a decrease from $8.12 at December 31, 2024.

What is the investment objective of the United States 12 Month Natural Gas Fund, LP?

UNL's investment objective is for the average daily percentage changes in per share net asset value to reflect the average daily percentage changes of the spot price of natural gas delivered at the Henry Hub, Louisiana, as measured by the daily percentage changes in the average of the prices of 12 natural gas futures contracts on the NYMEX, plus interest earned on collateral holdings, less expenses.

How many limited partner shares were outstanding for UNL as of November 3, 2025?

The registrant had 1,900,000 outstanding shares as of November 3, 2025. This is an increase from the 1,350,000 shares outstanding at September 30, 2025.

What is the role of United States Commodity Funds LLC for UNL?

United States Commodity Funds LLC (USCF) is the general partner of UNL and is responsible for its full management and control. USCF is also registered as a commodity pool operator with the CFTC.

What are the primary investments of UNL to achieve its objective?

UNL primarily invests in futures contracts for natural gas traded on the NYMEX, ICE Futures Europe, and ICE Futures U.S. To a lesser extent, it may also invest in other natural gas-related investments such as cash-settled options, forward contracts, cleared swap contracts, and OTC transactions.

What is the impact of contango and backwardation on UNL's investment returns?

Natural market forces called contango and backwardation may impact the total return on an investment in UNL's shares relative to a hypothetical direct investment in natural gas. UNL's investment objective is not for its NAV or market price to equal the spot price of natural gas over periods greater than one day due to these effects.

Did UNL experience an expense waiver during the reporting periods?

Yes, UNL had an expense waiver of $4,772 for the three months ended September 30, 2024, and $80,982 for the nine months ended September 30, 2024. There was no expense waiver for the 2025 periods.

What was the change in unrealized gain (loss) on open commodity futures contracts for UNL in the last quarter?

For the three months ended September 30, 2025, UNL experienced a change in unrealized gain (loss) on open commodity futures contracts of -$1,204,810, contributing to the quarterly net loss.

Risk Factors

Industry Context

The natural gas market is subject to significant price volatility driven by weather patterns, global supply and demand dynamics, storage levels, and geopolitical events. As a commodity pool, UNL's performance is directly linked to these factors and the specific futures contracts it holds. The industry is characterized by complex derivative markets and the need for sophisticated risk management to navigate price fluctuations.

Regulatory Implications

As a commodity pool, UNL is subject to regulations governing derivatives and commodity trading. Changes in regulations by bodies like the CFTC or SEC could impact trading strategies, costs, and reporting requirements. The fund's structure as a limited partnership also subjects it to partnership tax laws.

What Investors Should Do

  1. Monitor Natural Gas Market Trends
  2. Analyze Futures Contract Rollover Impact
  3. Evaluate Asset and Capital Declines
  4. Review Management Fees and Expenses

Key Dates

Glossary

Commodity Pool
A collective investment vehicle that trades in commodity futures contracts, options on futures contracts, or other commodity interests. (UNL is structured as a commodity pool, meaning its performance is directly tied to the underlying natural gas futures market.)
Benchmark Futures Contracts
The specific 12 natural gas futures contracts (near month to 11 months out) used by UNL to track the spot price of natural gas. The selection adjusts when the near month contract is within two weeks of expiration. (These contracts are central to UNL's investment objective and its performance measurement.)
Contango
A market condition where futures prices are higher than the spot price, and futures prices for longer-dated contracts are higher than those for shorter-dated contracts. (When the natural gas futures market is in contango, UNL's strategy of rolling contracts can lead to losses, impacting its NAV.)
Backwardation
A market condition where futures prices are lower than the spot price, and futures prices for longer-dated contracts are lower than those for shorter-dated contracts. (When the natural gas futures market is in backwardation, UNL's strategy of rolling contracts can be beneficial, potentially increasing its NAV.)
Net Asset Value (NAV)
The per-share market value of a fund, calculated by subtracting liabilities from assets and dividing by the number of outstanding shares. (UNL's NAV per share has decreased from $8.12 to $7.74, reflecting the fund's performance and changes in asset values.)
Realized Gain (Loss)
The profit or loss resulting from the sale or closing of an investment, such as a futures contract. (A realized gain of $2,119,553 on closed commodity futures contracts contributed positively to UNL's nine-month net income.)
Unrealized Gain (Loss)
The profit or loss on an investment that has not yet been sold or closed. It represents the change in value of open positions. (A change in unrealized loss of -$1,929,554 on open commodity futures contracts negatively impacted UNL's nine-month performance.)

Year-Over-Year Comparison

Compared to the prior year's comparable period, UNL experienced a widening net loss for the three months ended September 30, 2025 ($1,348,433 vs. $596,136). However, the nine-month period showed a turnaround to a net income of $453,047 from a net loss of $1,696,155, driven by realized gains on futures contracts. Total assets and partners' capital have significantly decreased, with total assets falling from $19,045,543 to $10,530,344 and partners' capital from $18,672,121 to $10,445,121, alongside a reduction in outstanding shares and NAV per share.

Filing Stats: 4,617 words · 18 min read · ~15 pages · Grade level 13.2 · Accepted 2025-11-07 15:16:03

Filing Documents

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION Page Item I. Financial Statements. 3

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. 20

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk. 39

Controls and Procedures

Item 4. Controls and Procedures. 40

OTHER INFORMATION

Part II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings. 41

Risk Factors

Item 1A. Risk Factors. 44

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 44

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities. 44

Mine Safety Disclosures

Item 4. Mine Safety Disclosures. 45

Other Information

Item 5. Other Information. 45

Exhibits

Item 6. Exhibits. 45 2 Table of Contents

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements. Index to Financial Statements Documents Page 4 Schedules of Investments at September 30, 2025 (Unaudited) and December 31, 2024 5 7 8 9

Notes to Financial Statements (Unaudited) for the period ended September 30, 2025

Notes to Financial Statements (Unaudited) for the period ended September 30, 2025 10 3 Table of Contents United States 12 Month Natural Gas Fund, LP At September 30, 2025 (Unaudited) and December 31, 2024 September 30, 2025 December 31, 2024 Assets Cash and cash equivalents (at cost $ 9,634,263 and $ 17,860,450 , respectively) (Notes 2 and 5) $ 9,634,263 $ 17,860,450 Equity in trading accounts: Cash and cash equivalents (at cost $ 1,667,644 and $–, respectively) 1,667,644 — Unrealized gain (loss) on open commodity futures contracts ( 814,334 ) 1,115,220 Dividends receivable 23,898 41,994 Interest receivable 11,422 27,345 Prepaid insurance 7,451 534 Total Assets $ 10,530,344 $ 19,045,543 Liabilities and Partners' Capital Payable due to Broker $ — $ 230,776 General Partner management fees payable (Note 3) 5,476 9,657 Professional fees payable 76,642 131,309 Brokerage commissions payable 391 391 Directors' fees payable 426 582 License fees payable 2,288 707 Total Liabilities 85,223 373,422 Commitments and Contingencies (Notes 3, 4 & 5) Partners' Capital General Partners — — Limited Partners 10,445,121 18,672,121 Total Partners' Capital 10,445,121 18,672,121 Total Liabilities and Partners' Capital $ 10,530,344 $ 19,045,543 Limited Partners' shares outstanding 1,350,000 2,300,000 Net asset value per share $ 7.74 $ 8.12 Market value per share $ 7.79 $ 8.17 See accompanying notes to financial statements. 4 Table of Contents United States 12 Month Natural Gas Fund, LP Schedule of Investments (Unaudited) At September 30, 2025 Fair Value/Unrealized Gain (Loss) on Open Number of Commodity % of Partners' Notional Amount Contracts Contracts Capital Open Commodity Futures Contracts - Long United States Contracts NYMEX Natural Gas Futures NG November 2025 contracts, expiring Oc

Notes to Financial Statements (Unaudited)

Notes to Financial Statements (Unaudited) For the period ended September 30, 2025 NOTE 1 — ORGANIZATION AND BUSINESS The United States 12 Month Natural Gas Fund, LP ("UNL") was organized as a limited partnership under the laws of the state of Delaware on June 27, 2007. UNL is a commodity pool that issues limited partnership shares ("shares") that are traded on the NYSE Arca, Inc. (the "NYSE Arca"). UNL will continue in perpetuity, unless terminated sooner upon the occurrence of one or more events as described in its Third Amended and Restated Agreement of Limited Partnership dated as of December 15, 2017 (the "LP Agreement"), which grants full management and control to its general partner, United States Commodity Funds LLC ("USCF"). The investment objective of UNL is for the average daily percentage changes in per share net asset value ("NAV") to reflect the average daily percentage changes of spot the price of natural gas delivered at the Henry Hub, Louisiana, as measured by the daily percentage changes in the average of the prices of 12 futures contracts for natural gas traded on the New York Mercantile Exchange (the "NYMEX"), consisting of the near month contract to expire and the contracts for the following 11 months for a total of 12 consecutive months' contracts, except when the near month contract is within two weeks of expiration, in which case it will be measured by the futures contract that is the next month contract to expire and the contracts for the following 11 consecutive months (the "Benchmark Futures Contracts"), plus interest earned on UNL's collateral holdings, less UNL's expenses. When calculating the daily movement of the average price of the 12 contracts, each contract month is equally weighted. UNL seeks to achieve its investment objective by investing so that the average daily percentage change in UNL's NAV for any period of 30 successive valuation days will be within plus/minus ten percent ( 10 %) of the average daily percentage change i

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