USL Plunges to $3.27M Loss Amid Futures Contract Declines

TL;DR

**USL's Q3 loss and declining NAV signal a tough environment for oil futures ETFs; traders should be wary of continued contango headwinds.**

AI Summary

United States 12 Month Oil Fund, LP (USL) reported a net loss of $3,265,475 for the nine months ended September 30, 2025, a significant decline from a net income of $2,115,288 for the same period in 2024. This shift was primarily driven by a realized loss of $3,166,106 on closed commodity futures contracts in 2025, compared to a realized gain of $2,049,051 in 2024. The fund also experienced a change in unrealized gain (loss) on open commodity futures contracts, moving from a loss of $1,798,643 in 2024 to a loss of $1,115,965 in 2025. Total assets decreased to $40,990,293 as of September 30, 2025, from $49,635,690 at December 31, 2024. Partners' Capital also fell to $40,825,678 from $49,416,184 over the same period, reflecting redemptions of 250,000 partnership shares totaling $9,168,358. The net asset value per share declined to $35.50 from $38.01.

Why It Matters

This filing reveals a significant underperformance for USL, an ETF designed to track crude oil prices, primarily due to negative returns on its futures contracts. For investors, this highlights the inherent risks of commodity-tracking funds, especially those exposed to contango, where future prices are higher than spot prices, eroding returns over time. The decline in net asset value per share and total partners' capital suggests reduced investor confidence and outflows, impacting the fund's liquidity and market presence. Competitively, this performance could push investors towards alternative oil exposure vehicles or direct equity investments in energy companies, rather than commodity ETFs.

Risk Assessment

Risk Level: high — The fund reported a net loss of $3,265,475 for the nine months ended September 30, 2025, a stark reversal from a $2,115,288 net income in the prior year. This significant loss, coupled with a decrease in total assets from $49,635,690 to $40,990,293, indicates substantial financial underperformance and capital erosion. The fund's exposure to contango, where futures prices are higher than spot prices, is explicitly mentioned as a natural market force impacting returns, posing an ongoing risk.

Analyst Insight

Investors should carefully re-evaluate their exposure to USL, considering the significant net losses and declining NAV per share. Given the explicit mention of contango as a factor impacting returns, long-term investors seeking direct oil price exposure might consider alternative investment vehicles or re-assess their risk tolerance for commodity futures ETFs.

Financial Highlights

total Assets

$40,990,293

net Income

-$3,265,475

cash Position

$35,391,101

Key Numbers

• $3,265,475 — Net Loss (for the nine months ended September 30, 2025, compared to a net income of $2,115,288 in 2024)
• $40,990,293 — Total Assets (as of September 30, 2025, down from $49,635,690 at December 31, 2024)
• $40,825,678 — Total Partners' Capital (as of September 30, 2025, down from $49,416,184 at December 31, 2024)
• $35.50 — Net Asset Value per share (as of September 30, 2025, down from $38.01 at December 31, 2024)
• 1,150,000 — Limited Partners' shares outstanding (as of November 3, 2025, down from 1,300,000 at December 31, 2024)
• $9,168,358 — Redemption of partnership shares (for the nine months ended September 30, 2025)
• $1,594,720 — Unrealized loss on open commodity futures contracts (as of September 30, 2025)
• $3,166,106 — Realized loss on closed commodity futures contracts (for the nine months ended September 30, 2025)
• 665 — Oil Futures Contracts (held by USL as of September 30, 2025)
• 4.09% — 7-day yield (for Dreyfus Institutional Preferred Government Money Market Fund at September 30, 2025)

Key Players & Entities

• United States 12 Month Oil Fund, LP (company) — registrant
• USCF (company) — General Partner and manager of USL
• NYSE Arca, Inc. (regulator) — exchange where USL shares are traded
• NYMEX (regulator) — exchange for WTI Crude Oil Futures
• ALPS Distributors, Inc. (company) — marketing agent for USL
• Commodity Futures Trading Commission (regulator) — regulates USCF as a commodity pool operator
• U.S. Securities and Exchange Commission (regulator) — declared USL's registration statement effective
• Dreyfus Institutional Preferred Government Money Market Fund (company) — money market fund holding USL's cash equivalents
• Morgan Stanley Institutional Liquidity Funds (company) — money market fund holding USL's cash equivalents
• United States Commodity Funds LLC (company) — General Partner of USL

FAQ

Risk Factors

• Commodity Futures Contract Volatility [high — market]: The fund's performance is directly tied to the price of light, sweet crude oil futures contracts. Significant fluctuations in oil prices, driven by global supply and demand, geopolitical events, and economic conditions, can lead to substantial realized and unrealized losses, as evidenced by the $3,166,106 realized loss and $1,594,720 unrealized loss on open contracts for the nine months ended September 30, 2025.
• Net Loss and Asset Decline [high — financial]: USL reported a net loss of $3,265,475 for the nine months ended September 30, 2025, a sharp reversal from a net income of $2,115,288 in the prior year. This decline is accompanied by a decrease in total assets to $40,990,293 from $49,635,690 and a reduction in partners' capital to $40,825,678 from $49,416,184.
• Share Redemptions and NAV Decrease [medium — financial]: The fund experienced redemptions of 250,000 partnership shares totaling $9,168,358 during the nine months ended September 30, 2025. This outflow contributed to a decrease in outstanding shares to 1,150,000 from 1,300,000 and a decline in net asset value per share to $35.50 from $38.01.
• Contango and Roll Yield Impact [medium — market]: The fund's investment strategy involves rolling futures contracts. If the futures market is in contango (longer-dated contracts are more expensive than near-term contracts), this 'roll yield' can negatively impact performance over time, potentially exacerbating losses.
• Management and Operational Expenses [low — operational]: While not explicitly detailed as a primary driver of the loss in the summary, ongoing management fees, professional fees, and other operational expenses reduce the fund's overall returns and can impact net asset value.

Industry Context

The oil futures market is highly volatile, influenced by global geopolitical events, supply/demand dynamics, and macroeconomic factors. Funds like USL that track oil prices are subject to significant price swings. The trend towards renewable energy and evolving environmental regulations also present long-term considerations for fossil fuel-based investments.

Regulatory Implications

As a commodity pool, USL is subject to regulations by the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA). Compliance with reporting requirements and risk management rules is crucial. Changes in energy policy or financial regulations could impact the fund's operations and investment strategies.

What Investors Should Do

1. Review the impact of realized and unrealized losses on futures contracts.
2. Monitor oil price volatility and geopolitical events.
3. Assess the sustainability of the fund's strategy in a potentially contango market.
4. Evaluate the impact of ongoing share redemptions on liquidity and NAV.

Key Dates

• 2025-09-30: Nine months ended September 30, 2025 — Reported a net loss of $3,265,475 and a decrease in total assets to $40,990,293.
• 2024-09-30: Nine months ended September 30, 2024 — Reported a net income of $2,115,288.
• 2025-12-31: As of December 31, 2024 — Total assets were $49,635,690 and partners' capital was $49,416,184.
• 2024-12-06: December 6, 2007 — USL's shares began trading on the NYSE Arca, indicating the fund's inception and market debut.

Glossary

Commodity Pool

A collective investment vehicle that trades in commodity futures contracts, options on futures, and other commodity interests. (USL is structured as a commodity pool, meaning its performance is directly linked to the underlying commodity futures it trades.)

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. (The NAV per share of USL declined to $35.50 from $38.01, reflecting the fund's recent performance and asset depreciation.)

Futures Contracts

A standardized legal agreement to buy or sell a particular commodity or asset at a predetermined price at a specified time in the future. (USL primarily invests in crude oil futures contracts, which are the main drivers of its gains and losses.)

Realized Gain (Loss)

The profit or loss resulting from the sale or closing of an investment position. (USL incurred a significant realized loss of $3,166,106 on closed commodity futures contracts for the nine months ended September 30, 2025.)

Unrealized Gain (Loss)

The profit or loss on an investment that has not yet been sold or closed out; it represents the change in market value of open positions. (USL had an unrealized loss of $1,594,720 on its open commodity futures contracts as of September 30, 2025.)

Contango

A market condition where futures prices are higher than spot prices, typically for longer-dated contracts. (This condition can negatively impact funds that roll futures contracts, as it implies a cost to maintain positions.)

Roll Yield

The return or loss generated from closing a near-term futures contract and opening a longer-dated one, often influenced by contango or backwardation. (This is a key component of performance for futures-based ETFs like USL, and can be a drag on returns in a contango market.)

Year-Over-Year Comparison

Compared to the nine months ended September 30, 2024, which saw a net income of $2,115,288, the same period in 2025 resulted in a net loss of $3,265,475. This dramatic shift was driven by a substantial swing from a realized gain of $2,049,051 to a realized loss of $3,166,106 on commodity futures. Total assets have decreased from $49,635,690 to $40,990,293, and partners' capital has similarly fallen, reflecting both market performance and redemptions.

Filing Documents

• usl-20250930x10q.htm (10-Q) — 1170KB
• usl-20250930xex31d1.htm (EX-31.1) — 14KB
• usl-20250930xex31d2.htm (EX-31.2) — 14KB
• usl-20250930xex32d1.htm (EX-32.1) — 7KB
• usl-20250930xex32d2.htm (EX-32.2) — 7KB
• usl-20250930x10q010.jpg (GRAPHIC) — 49KB
• usl-20250930x10q011.jpg (GRAPHIC) — 57KB
• usl-20250930x10q012.jpg (GRAPHIC) — 59KB
• usl-20250930x10q013.jpg (GRAPHIC) — 45KB
• 0001104659-25-108398.txt ( ) — 4778KB
• usl-20250930.xsd (EX-101.SCH) — 42KB
• usl-20250930_cal.xml (EX-101.CAL) — 24KB
• usl-20250930_def.xml (EX-101.DEF) — 95KB
• usl-20250930_lab.xml (EX-101.LAB) — 234KB
• usl-20250930_pre.xml (EX-101.PRE) — 184KB
• usl-20250930x10q_htm.xml (XML) — 626KB

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements. 1

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. 18

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk. 37

Controls and Procedures

Item 4. Controls and Procedures. 38

OTHER INFORMATION

Part II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings. 38

Risk Factors

Item 1A. Risk Factors. 41

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 42

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities. 42

Mine Safety Disclosures

Item 4. Mine Safety Disclosures. 42

Other Information

Item 5. Other Information. 42

Exhibits

Item 6. Exhibits. 43 Table of Contents

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements. Index to Financial Statements Documents Page 2 Schedule of Investments at September 30, 2025 (Unaudited) and December 31, 2024 3 5 6 7

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

Notes to Financial Statements (Unaudited) for the period ended September 30 , 2025 8 1 Table of Contents United States 12 Month Oil Fund, LP At September 30 , 2025 (Unaudited) and December 31, 2024 September 30, 2025 December 31, 2024 Assets Cash and cash equivalents (at cost $ 35,391,101 and $ 31,866,921 , respectively) (Notes 2 and 5) $ 35,391,101 (a) $ 31,866,921 Equity in trading accounts: Cash and cash equivalents (at cost $ 7,039,712 and $ 18,058,747 , respectively) 7,039,712 18,058,747 Unrealized gain (loss) on open commodity futures contracts ( 1,594,720 ) ( 478,755 ) Dividends receivable 107,777 74,940 Interest receivable 35,288 111,757 Prepaid insurance 11,135 2,080 Total Assets $ 40,990,293 $ 49,635,690 Liabilities and Partners' Capital General Partner management fees payable (Note 3) $ 21,105 $ 26,178 Professional fees payable 116,076 170,817 Brokerage commissions payable 12,602 12,602 Directors' fees payable 1,368 1,389 License fees payable 13,464 8,520 Total Liabilities 164,615 219,506 Commitments and Contingencies (Notes 3, 4 & 5) Partners' Capital General Partners — — Limited Partners 40,825,678 49,416,184 Total Partners' Capital 40,825,678 49,416,184 Total Liabilities and Partners' Capital $ 40,990,293 $ 49,635,690 Limited Partners' shares outstanding 1,150,000 1,300,000 Net asset value per share $ 35.50 $ 38.01 Market value per share $ 35.60 $ 38.02 (a) A portion of this amount is designated to meet daily Futures Commission Merchants' margin requirements. See accompanying notes to financial statements. 2 Table of Contents United States 12 Month Oil Fund, LP Schedule of Investments (Unaudited) At September 30 , 2025 Fair Value/Unrealized Gain (Loss) on Open Notional Number of Commodity % of Partners' Amount Contracts Contracts Capital Open Commod

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 Oil Fund, LP ("USL") was organized as a limited partnership under the laws of the state of Delaware on June 27, 2007. USL is a commodity pool that issues limited partnership interests ("shares") traded on the NYSE Arca, Inc. (the "NYSE Arca"). USL's shares began trading on December 6, 2007. Prior to November 25, 2008, USL's shares traded on the American Stock Exchange (the "AMEX"). USL 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 (as amended from time to time, the "LP Agreement"), which grants full management and control to its General Partner, United States Commodity Funds LLC ("USCF"). The investment objective of USL is for the daily changes in percentage terms of its per share net asset value ("NAV") to reflect the daily changes in percentage terms of the spot price of light, sweet crude oil delivered to Cushing, Oklahoma, as measured by the daily changes in the average of the prices of specified short-term futures contracts on light, sweet crude oil called the "Benchmark Oil Futures Contracts," plus interest earned on USL's collateral holdings, less USL's expenses. The Benchmark Oil Futures Contracts are the futures contracts on light, sweet crude oil as traded on the New York Mercantile Exchange (the "NYMEX") that is 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 the futures contract that is the next month contract to expire and the contracts for the following 11 consecutive months. When calculating the daily movement of the average price of the 12 contracts, each contract month i

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