CL curve has been in contango since last year and by its prospectus USO can only hold front month futures. Therefore it's losing money after rolling each month. Same thing if you are holding front month CL long term. It's a price to pay if you don't want to deal with the illiquidity on the further end of the curve.
Someone has to hand the money over to Andy Hall and others like him... USO investors are very generous people and have taken it upon themselves to do their bit to recapitalize Citi and other banks. I am not being entirely facetious either...
That's Right. Im long USL and short USO (pairs) since june. The problema that I have with USL is the lack of liquidity But It has been a good spread so far.
When you say "crude" is off 50% what do you mean by that? Which price are you tracking and what does USO invest in?