NEW YORK--(BUSINESS WIRE)--Labaton Sucharow LLP, a leading and award winning investor rights law firm, announces it is developing a proprietary investigation concerning potential securities claims on behalf of shareholders and option holders of the United States Oil Fund LP (Ticker: USO) resulting from allegations that USO may have issued materially misleading business information to the investing public.
The United States Oil Fund (USO) is an exchanged-traded fund (ETF) that seeks to provide investment results corresponding to the daily price movements of West Texas Intermediate (WTI) light, sweet crude oil. The USO is designed for investors who are long or bullish on short-term futures contracts on West Texas Intermediate (WTI) crude oil.
On April 20, the May contract for WTI crude closed at -$37.63 a barrel, a one-day drop of $55.90 or 300%. This was a historic and unprecedented disruption in the oil markets.
In its March 23, 2020 registration statement, USO issued the following statement:
The crude oil market was primarily in contango the first half of 2019 and in backwardation from August through December 31, 2019…… USCF does not anticipate letting USO’s Oil Futures Contracts expire and taking delivery of the underlying commodity. Instead, USCF will close existing positions, e.g., when it changes the Benchmark Oil Futures Contracts or Other Oil-Related Investments or it otherwise determines it would be appropriate to do so and reinvests the proceeds in new Oil Futures Contracts or Other Oil-Related Investments. Positions may also be closed out to meet orders for Redemption Baskets and in such case proceeds for such baskets will not be reinvested.
Labaton is investigating whether such statements were false and misleading, given that, among other things, USO held approximately 25% of the market of May WTI contracts.
On April 21, trading in USO was temporarily halted and share value fell 25.1% to close at a record low of $2.81. USO is down over 78% year-to-date and down over 96% since its inception.
If you are an investor in USO shares or options, and wish to participate, learn more, or discuss the issues surrounding the investigation, please contact David J. Schwartz using the toll free number (800) 321-0476 or via email at firstname.lastname@example.org.
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