United States Oil Fund Reports $40.3 Million Net Income in Q1 2025

The United States Oil Fund, LP (USO) reported its financial results for the first quarter of 2025, revealing a net income of $40.3 million, a significant decrease from $240.3 million in the same period last year. The fund's total income for the quarter was $42.4 million, down from $243.2 million in the prior year, primarily due to a decline in realized gains from trading commodity futures and swap contracts. The fund's net asset value (NAV) per share increased to $77.35 from $75.45 at the end of the previous quarter, reflecting a total return of 2.52% for the period.

In comparison to the previous fiscal period, USO experienced a notable reduction in trading activity, with realized gains on closed commodity futures contracts dropping to $17.5 million from $127.4 million year-over-year. The fund also reported a realized loss of $1.1 million on closed OTC commodity swap contracts, contrasting with a gain of $45.3 million in the prior year. The decrease in trading activity and income was attributed to lower market volatility and changes in market conditions affecting oil prices.

Operationally, USO held 12,623,603 shares outstanding as of March 31, 2025, down from 14,423,603 shares at the end of the previous quarter. The fund's average daily total net assets decreased to approximately $1.02 billion from $1.42 billion year-over-year. The average yield on short-term investments, including cash and cash equivalents, was reported at 4.02%, down from 4.80% in the prior year, contributing to a decline in dividend and interest income.

Strategically, USO has transitioned its investment portfolio to primarily focus on the Benchmark Oil Futures Contract, consistent with its investment strategy prior to the market volatility experienced in 2020. This shift began with the monthly roll in September 2023 and concluded in January 2024. The fund continues to hold a significant portion of its assets in cash and cash equivalents, totaling $782.9 million, which is used for margin and collateral requirements related to its trading activities.

Looking ahead, USO's management remains cautious about market conditions, particularly in light of geopolitical tensions and potential economic slowdowns that could impact oil demand. The fund's ability to track the performance of the Benchmark Oil Futures Contract closely will depend on various factors, including market volatility, regulatory requirements, and the overall economic environment. USO's management has indicated that it will continue to monitor these conditions and adjust its investment strategy as necessary to meet its objectives.