8-K: United States 12 Month Oil Fund, LP Reports Annual Financial Results for 2024

United States 12 Month Oil Fund, LP releases its annual financial statements for the year ended December 31, 2024, showing a net income of $5,056,744.

Summary

• United States 12 Month Oil Fund, LP (USL) has released its annual financial statements for the year ended December 31, 2024.
• The fund reported a net income of $5,056,744, or $2.78 per limited partner share.
• At the end of 2024, USL's net asset value (NAV) per share was $38.01, with 1,300,000 shares outstanding.
• The fund's total assets were $49,635,690, and total liabilities were $219,506.
• USL invests primarily in futures contracts for light, sweet crude oil and other oil-related investments.
• The fund's investment objective is to reflect the daily changes in percentage terms of the spot price of light, sweet crude oil.
• USCF is the general partner of USL and is responsible for managing the fund's assets.
• The fund's financial statements have been prepared in conformity with U.S. GAAP.
• USL is not subject to federal income taxes; each partner reports their share of income, gain, loss, deductions, or credits on their own income tax return.
• Authorized Participants may purchase Creation Baskets or redeem Redemption Baskets only in blocks of 50,000 shares at a price equal to the NAV of the shares calculated shortly after the close of the core trading session on the NYSE Arca on the day the order is placed.

Sentiment

Score: 7

Explanation: The document presents a generally positive picture due to the return to profitability and increase in NAV per share, although the decrease in total assets and outstanding shares tempers the overall sentiment.

Positives

• USL achieved a net income of $5,056,744 for the year 2024, a significant improvement compared to the net loss of $56,520 in 2023.
• The NAV per share increased from $35.23 to $38.01, indicating positive performance for shareholders.
• The fund's total return for 2024 was 7.89%.

Negatives

• Total assets decreased from $67,162,488 in 2023 to $49,635,690 in 2024, indicating a contraction in the fund's size.
• Limited Partners shares outstanding decreased from 1,900,000 to 1,300,000, reflecting a reduction in investor participation.
• The fund experienced an unrealized loss on open commodity futures contracts of $478,755 as of December 31, 2024.

Risks

• USL is exposed to market risk arising from changes in the market value of its futures contracts.
• The fund is also subject to credit risk, which is the risk of failure by another party to perform according to the terms of a contract.
• Significant market volatility in the crude oil markets could affect the value, pricing, and liquidity of USL's investments.
• The insolvency of an FCM could result in the complete loss of USL's assets posted with that FCM.
• The failure or insolvency of USL's custodian could result in a substantial loss of USL's assets.

Future Outlook

The document does not contain specific forward-looking statements or guidance beyond the fund's stated investment objective.

Management Comments

• John P. Love, President and Chief Executive Officer of United States Commodity Funds LLC, states, 'Thank you for your continued interest in USL.'

Industry Context

USL operates in the commodity ETF market, providing investors with exposure to crude oil futures contracts; it competes with other commodity-based exchange-traded funds, including those managed by USCF, such as USO, UNG, UGA, UNL, and BNO.

Comparison to Industry Standards

• USL's performance can be compared to other oil-tracking ETFs like the United States Oil Fund (USO), which also invests in crude oil futures.
• The management fee of 0.60% is within the typical range for commodity ETFs, but investors should compare this to similar funds to assess its competitiveness.
• The fund's ability to track the spot price of light, sweet crude oil can be evaluated against its stated investment objective and compared to the tracking performance of other oil ETFs.

Related Party Transactions

• USCF receives a management fee equal to 0.60% per annum of average daily total net assets.
• USL shares fees and expenses of independent directors and officers liability insurance on a pro rata basis with Related Public Funds.
• USL pays licensing fees to the NYMEX under a licensing agreement.

Stakeholder Impact

• Shareholders experienced an increase in NAV per share, reflecting positive investment performance.
• Authorized Participants are subject to transaction fees for creating or redeeming baskets of shares.
• The fund's performance is influenced by market conditions and the ability to track the spot price of crude oil.

Key Dates

Keywords

oil, futures contracts, financial statements, USL, United States 12 Month Oil Fund, commodity fund, USCF, net asset value, crude oil