UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      D.C. 20549




FORM
      10-K




x
            Annual
                report pursuant to
                Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
                fiscal year ended December 31, 2007.




 ̈
            Transition
                report pursuant to
                Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
                transition period fromto.




Commission
      file number: 001-33859




United
      States 12 Month Oil Fund,
      LP


(Exact
      name of registrant as
      specified in its charter)




Delaware
            
            20-0431897(State
                or other jurisdiction ofincorporation
                or
                organization)
            
            (I.R.S.
                EmployerIdentification
                No.)




1320
      Harbor Bay Parkway, Suite
      145


Alameda,
      California
      94502


(Address
      of principal executive
      offices) (Zip Code)




(510)
      522-3336


(Registrant’s
      telephone number,
      including area code)




Securities
      registered pursuant to
      Section 12(b) of the Act:


Units American
      Stock
      Exchange


(Title
      of class)     (Name of exchange on which
      registered)









Securities
      registered pursuant to
      Section 12(g) of the Act: None




Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act.


 ̈ Yes x No





Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or Section 15(d) of the Act.


 ̈ Yes x No





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
      during the preceding 12 months (or for such shorter period that the registrant
      was required to file such reports), and (2) has been subject to such filing
      requirements for the past 90 days.


x Yes  ̈ No





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K (§229.405) is not contained herein, and will not be contained, to
      the best of registrant’s knowledge, in definitive proxy or information
      statements incorporated by reference in Part III of this Form 10-K or any
      amendment to this Form 10-K. x




Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, a non-accelerated filer or a smaller reporting company.
      See definitions of "large accelerated filer," "accelerated filer" and "smaller
      reporting company" in Rule 12b-2 of the Exchange Act. (Check one.)


Large
      accelerated filer  ̈ Accelerated
      filer  ̈ Non-accelerated
      filer x Smaller reporting company   ̈


(Do
      not check if a smaller reporting company)




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Act.).


 ̈ Yes x No


The
        aggregate market value of the registrant’s units held by non-affiliates of the
        registrant as of June
        30,
        2007 was: $0.
  The
        registrant had 200,000 outstanding units as of March
        18, 2008.


DOCUMENTS
      INCORPORATED BY
      REFERENCE:


None.








UNITED
                  STATES 12 MONTH OIL
                  FUND, LPTable
                  of
                  ContentsPart
                  I.
              
              PageItem
                  1. Business
              
              1Item
                  1A. Risk Factors
              
              34Item
                  1B. Unresolved Staff Comments
              
              49Item
                  2. Properties
              
              49Item
                  3. Legal Proceedings
              
              50Item
                  4. Submission of Matters to a Vote of Security
                  Holders
              
              51Part
                  II.Item
                  5. Market for Registrant's Common Equity, Related
                  StockholderMatters
                  and Issuer Purchases of Equity
                  Securities
              
              51Item
                  6. Selected Financial Data
              
              51Item
                  7. Management's Discussion and Analysis of Financial
                  Conditionand
                  Results of Operations
              
              52Item
                  7A. Quantitative and Qualitative Disclosures About
                  Market Risk
              
              60Item
                  8. Financial Statements and Supplementary
                  Data
              
              61Item
                  9. Changes in and Disagreements with Accountants onAccounting
                  and Financial Disclosure
              
              72Item
                  9A. Controls and Procedures
              
              72Item
                  9B. Other Information
              
              72Part
                  III.Item
                  10. Directors, Executive Officers and
                  Corporate Governance
              
              73Item
                  11. Executive Compensation
              
              76Item
                  12. Security Ownership of Certain Beneficial Owners
                  andManagement
                  and Related Stockholder
                  Matters
              
              77Item
                  13. Certain Relationships and Related
                  Transactions, and Director Independence
              
              77Item
                  14. Principal Accountant Fees and
                  Services
              
              77Part
                  IV.Item
                  15. Exhibits and Financial Statement
                  Schedules
              
              78Exhibit
                  Index
              
              78Signatures
              
              79


Part
        I





Item 1.
            Business.




What
        is US12OF?
  United
        States 12 Month Oil Fund, LP ("US12OF") is a Delaware limited partnership
        organized on June 27, 2007. US12OF maintains its main business office at
        1320
        Harbor Bay Parkway, Suite 145, Alameda, California 94502. US12OF is a commodity
        pool that issues limited partnership interests ("units") traded on the American
        Stock Exchange (the "AMEX"). It operates pursuant to the terms of
        the Amended and Restated Agreement of Limited Partnership dated as of
        December 4, 2007 (the "LP Agreement"), which grants full management control
        to
        the general partner.
  Who
        is the General
        Partner?
  US12OF's general
        partner is Victoria Bay Asset Management, LLC (the "General Partner"), a
        single
        member limited liability company that was formed in the state of Delaware
        on May
        10, 2005. It maintains its main business office at 1320 Harbor Bay Parkway,
        Suite 145, Alameda, California 94502. The General Partner is a wholly-owned
        subsidiary of Wainwright Holdings, Inc., a Delaware corporation (“Wainwright”).
        Mr. Nicholas Gerber (discussed below) controls Wainwright by virtue of his
        ownership of Wainwright’s shares. Wainwright is a holding company that also owns
        an insurance company organized under Bermuda law and a registered investment
        adviser firm named Ameristock Corporation. The General Partner is a member
        of
        the National Futures Association (the "NFA") and was registered with the
        Commodity Futures Trading Commission (the "CFTC") as of December 1, 2005.
        The
        General Partner’s registration as a Commodity Pool Operator ("CPO") was approved
        on December 1, 2005.
 On
          May
          12, 2005, the General Partner formed the United States Oil Fund, LP
          (“USOF”), another limited partnership that is a commodity pool and
          issues units traded on the AMEX.  The investment objective
          of USOF is for the changes in percentage terms of its units’ net asset value
          (“NAV”) to reflect the changes in percentage terms of the price of light, sweet
          crude oil delivered to Cushing, Oklahoma, as measured by the changes in
          the
          price of the futures contract for light, sweet crude oil traded on the
          New York
          Mercantile Exchange (the "NYMEX"), less USOF's expenses.  USOF began
          trading on April 10, 2006.  The General Partner is the general partner
          of USOF and is responsible for the management of the USOF.  Wainwright
          was the initial limited partner of USOF. Investors in US12OF who wish to
          receive
          additional information concerning the United States Oil Fund, LP, may do
          so by
          calling 1-800-920-0259, or going on-line to
          www.unitedstatesoilfund.com.
 On
        September 8, 2006, the General Partner formed the United States Natural Gas
        Fund, LP ("USNG'), also a limited partnership that is a commodity pool
        and issues units traded on the AMEX. The investment objective of USNG
        is for the changes in percentage terms of its units' NAV to reflect the changes
        in percentage terms of the price of natural gas delivered at the Henry Hub,
        Louisiana, as measured by the changes in the price of the futures contract
        on
        natural gas traded on the NYMEX, less USNG’s expenses. USNG began trading on
        April 18, 2007. The General Partner is the general partner of USNG and is
        responsible for the management of USNG. Wainwright was the initial limited
        partner of USNG. Investors in US12OF who wish to receive additional information
        concerning the United States Natural Gas Fund, LP, may do so by calling
        1-800-920-0259, or going on-line to
        www.unitedstatesnaturalgasfund.com.
  On
          April
          12, 2007, the General Partner formed the United States Gasoline Fund, LP
          (“USG”), also a limited partnership that is a commodity pool and issues units
          traded on the AMEX.  The investment  objective of USG is for
          the changes in percentage terms of its units’ NAV to reflect the changes in
          percentage terms of the price of unleaded gasoline delivered to the New
          York
          harbor, as measured by the changes in the price of the futures contract
          on
          gasoline traded on the NYMEX, less USG's expenses.  USG began trading
          on February 26, 2008.  The General Partner is the general partner of
          USG and is responsible for the management of USG.  Wainwright was the
          initial limited partner of USG.  Investors in US12OF who wish to receive
          additional information concerning the United States Gasoline Fund, LP, may
          do so by calling 1-800-920-0259, or going on-line to
          www.unitedstatesgasolinefund.com.
 The
          General Partner is currently in the process of registering two other exchange
          traded securities, the United States Heating Oil Fund, LP (“USHO")
          and the United States 12 Month Natural Gas Fund, LP
          (“US12NG”).  USHO will be a publicly traded limited partnership which
          seeks to have the changes in percentage terms of its units’ NAV track the
          changes in percentage terms of the price of heating oil (also known as
          No. 2
          fuel) delivered to the New York harbor.  US12NG will be a publicly
          traded limited partnership which will seek to have the changes in percentage
          terms of its units’ NAV reflect the changes in percentage terms of the price of
          natural gas delivered at the Henry Hub, Louisiana, as measured by the changes
          in
          the average of the prices of 12 futures contracts on natural gas traded
          on the
          NYMEX, consisting of the near month contract to expire and the contracts
          for the
          following 11 months, for a total of 12 consecutive months’
contracts.
 1
 The
            General Partner is required to evaluate the credit risk for US12OF to
            the
            futures commission merchant, oversee the purchase and sale of US12OF’s units by
            certain authorized purchasers ("Authorized Purchasers"), review daily
            positions
            and margin requirements of US12OF and manage US12OF’s investments. The General
            Partner also pays the fees of ALPS Distributors, Inc. (the "Marketing
            Agent")
            and Brown Brothers Harriman & Co. ("BBH&Co."), which acts as
            the administrator (the "Administrator") and the custodian (the "Custodian")
            for
            US12OF.
 Limited
              partners have no right to elect the General Partner on an annual or
              any other
              continuing basis. If the General Partner voluntarily withdraws, however,
              the
              holders of a majority of US12OF's outstanding units (excluding for
              purposes of
              such determination units owned, if any, by the withdrawing General Partner
              and its affiliates) may elect its successor. The General Partner may
              not be
              removed as general partner except upon approval by the affirmative
              vote of the
              holders of at least 66 and 2/3 percent of US12OF's outstanding units
              (excluding
              units owned, if any, by the General Partner and its affiliates), subject to
              the satisfaction of certain conditions set forth in the LP
              Agreement.
  The
              business and affairs of the General Partner are managed by a board
              of directors,
              which is comprised of four management directors, some of whom are also
              its
              executive officers (the “Management Directors”) and three independent directors
              who meet the independent director requirements established by the AMEX
              and the
              Sarbanes-Oxley Act of 2002. Notwithstanding the foregoing, the Management
              Directors have the authority to manage the General Partner pursuant
              to
              its Third Amended and Restated Limited Liability Company Agreement. The
              board of directors of the General Partner has an audit committee which
              is made
              up of the three independent directors (Peter M. Robinson, Gordon L.
              Ellis and
              Malcolm R. Fobes III). The audit committee is governed by an audit
              committee
              charter that is posted on US12OF’s website,
              http://www.unitedstates12monthoilfund.com. Mr. Fobes and Mr. Ellis
              meet the financial sophistication requirements of the AMEX and the
              audit
              committee charter. Through its Management Directors, the General Partner
              manages
              the day-to-day operations of US12OF.
  How
          Does US12OF
          Operate?
  The
          net
          assets of US12OF consist primarily of investments in futures contracts
          for light, sweet crude oil, but may also consist of other types of crude
          oil, heating oil, gasoline, natural gas and other petroleum-based fuels
          that are
          traded on the NYMEX, ICE Futures or other U.S. and foreign exchanges
          (collectively, “Futures Contracts”). US12OF may also invest in other oil-related
          investments such as cash-settled options on Futures Contracts, forward
          contracts for oil, and over-the-counter transactions that are based on
          the price
          of crude oil, heating oil, gasoline, natural gas and other
          petroleum-based fuels, Futures Contracts and indices based on the foregoing
          (collectively, “Other Crude Oil Related Investments”). For convenience and
          unless otherwise specified, Futures Contracts and Other Crude Oil Related
          Investments collectively are referred to as “Crude Oil Interests” in this annual
          report on Form 10-K.
  US12OF
          invests in Crude Oil Interests to the fullest extent possible without being
          leveraged or unable to satisfy its current or potential margin or collateral
          obligations with respect to its investments in Futures Contracts and Other
          Crude Oil Related Investments. In pursuing this objective, the primary
          focus of
          the General Partner is the investment in Futures Contracts and the
          management of its investments in short-term obligations of the United States
          of
          two years or less (“Treasuries”), cash and/or cash equivalents for
          margining purposes and as collateral.
  The
          investment objective of US12OF is to have the changes in percentage terms
          of the
          units’ NAV reflect the changes in percentage terms of the price
          of light, sweet crude oil delivered to Cushing, Oklahoma, as measured by
          the changes in the average of the prices of the 12 Futures Contracts
          on crude oil traded on the NYMEX (the "Benchmark Futures Contracts"),
          consisting of the near month contract to expire and the contracts for the
          following eleven 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 measured by the futures contracts that are the next month contract
          to
          expire and the contracts for the following 11 consecutive months, less
          US12OF's
          expenses. When calculating the daily movement of the average price of the
          12
          contracts each contract month is equally weighted.
  It
            is not
            the intent of US12OF to be operated in a fashion such that its NAV will
            equal,
            in dollar terms, the dollar price of spot crude oil or any particular
            futures
            contract based on crude oil.
 2


The
        General Partner believes that holding futures contracts whose expiration
        dates
        are spread out over a 12 month period of time will cause the total return
        of
        such a portfolio to vary compared to a portfolio that holds only a single
        month’s contract (such as the near month contract). In particular, the General
        Partner believes that the total return of a portfolio holding contracts with
        a
        range of expiration months will be impacted differently by the price
        relationship between different contract months of the same commodity future
        compared to the total return of a portfolio consisting of the near month
        contract. For example, in cases in which the near month contract’s price is
        higher than the price of contracts that expire later in time (a situation
        known
        as “backwardation” in the futures markets), then absent the impact of the
        overall movement in crude oil prices the value of the near month contract
        would
        tend to rise as it approaches expiration. Conversely, in cases in which the
        near
        month contract’s price is lower than the price of contracts that expire later in
        time (a situation known as “contango” in the futures markets), then absent the
        impact of the overall movement in crude oil prices the value of the near
        month
        contract would tend to decline as it approaches expiration. The total return
        of
        a portfolio that owned the near month contract and “rolled” forward each month
        by selling the near month contract as it approached expiration and purchasing
        the next month contract to expire would be positively impacted by a
        backwardation market, and negatively impacted by a contango market. Depending
        on
        the exact price relationship of the different months' prices, portfolio
        expenses, and the overall movement of crude oil prices, the impact of
        backwardation and contango could have a major impact on the total return
        of such
        a portfolio over time. The General Partner believes that based on historical
        evidence a portfolio that held futures contracts with a range of expiration
        dates spread out over a 12 month period of time would typically be impacted
        less
        by the positive effect of backwardation and the negative effect of contango
        compared to a portfolio that held contracts of a single near month. As a
        result,
        absent the impact of any other factors, a portfolio of 12 different monthly
        contracts would tend to have a lower total return than a near month only
        portfolio in a backwardation market and a higher total return in a contango
        market. However there can be no assurance that such historical relationships
        would provide the same or similar results in the future.
 
 As
        a
        specific benchmark, the General Partner will endeavor to place US12OF’s trades
        in Futures Contracts and Other Crude Oil-Related Investments and otherwise
        manage US12OF’s investments so that “A” will be within plus/minus 10 percent of
“B”, where:
 
 •
              A
                  is the average daily change in US12OF’s NAV for any period of 30
                  successive valuation days, i.e., any day as of which US12OF calculates
                  its
                  NAV, and
 •
              B
                  is the average daily change in the average of the prices of the
                  Benchmark
                  Futures Contracts over the same
                  period.







An
        investment in the units allows both retail and institutional investors to
        easily
        gain exposure to the crude oil market in a cost-effective manner. The units
        are
        also expected to provide additional means for diversifying an investor’s
        investments or hedging exposure to changes in crude oil prices.
 
 The
        Benchmark Futures Contracts will be changed or “rolled” from the near month
        contract and the eleven following months to expire to the next month to expire
        and the eleven following months during one day.
 3
 The
        General Partner believes that market arbitrage opportunities will cause changes
        in US12OF’s unit price on the AMEX to closely track changes in US12OF’s NAV. The
        General Partner believes that changes in US12OF’s NAV in percentage terms will
        closely track the changes in percentage terms in the Benchmark Futures
        Contracts, less US12OF’s expenses.
 These
        relationships are illustrated in the following diagram:


The
        Price of US12OF’s Units Is
        Expected to Correlate Closely
 With
        US12OF’S NAV
  US12OF’s
        units are traded on the AMEX. The price of
 units
        fluctuates in response to US12OF’s NAV and the supply and demand
 pressures
        of the AMEX. Because of certain arbitrage opportunities, the
 General
        Partner believes the price of US12OF’s units traded on the
 AMEX
        will
        correlate closely with US12OF’s NAV.
   Changes
        in US12OF’s NAV Are Expected
        to Correlate Closely With
 the
        Changes in the Price of the
        Benchmark
 Futures
        Contracts
  The
        General Partner endeavors to invest US12OF’s assets as fully as
 possible
        in Futures Contracts and Other Crude Oil Related Investments so that
        the
 changes
        in the NAV closely correlate with the changes in the price of the
 Benchmark Futures
        Contracts.
 4
 The
            General Partner employs a “neutral” investment strategy in order to track
            changes in the price of the Benchmark Futures Contracts regardless of
            whether these prices go up or go down. US12OF’s “neutral” investment
            strategy is designed to permit investors generally to purchase and sell
            US12OF’s
            units for the purpose of investing indirectly in crude oil in a cost-effective
            manner, and/or to permit participants in the crude oil markets or other
            industries to hedge the risk of losses in their crude oil-related transactions.
            Accordingly,
            depending on the investment objective of an individual investor, the
            risks
            generally associated with investing in crude oil and/or the risks involved
            in
            hedging may exist. In addition, an investment in US12OF involves the
            risk that
            the changes in the price of US12OF’s units will not accurately track the changes
            in the Benchmark Futures Contract.
 US12OF’s
          total portfolio composition is disclosed each business day that the AMEX
          is open
          for trading on US12OF’s website and through the AMEX’s website at
          http://www.amex.com. The website disclosure of portfolio holdings is made
          daily
          and includes, as applicable, the name and value of each Crude Oil Interest,
          the
          specific types of Other Crude Oil Related Investments and characteristics
          of
          such Other Crude Oil Related Investments, Treasuries, and the amount of
          cash
          and/or cash equivalents held in US12OF’s portfolio. US12OF’s website is publicly
          accessible at no charge. US12OF’s assets are held in segregation pursuant to the
          Commodity Exchange Act (the "CEA") and CFTC regulations.
 
 The
            units issued by US12OF may be purchased
            only by Authorized Purchasers only in blocks of 100,000 units called
            Creation
            Baskets. The amount of the purchase payment for a Creation Basket is
            equal to
            the aggregate NAV of units in the Creation Basket. Similarly, Authorized
            Purchasers may redeem units only in blocks of 100,000 units called Redemption
            Baskets. The amount of the redemption proceeds for a Redemption Basket
            is equal
            to the aggregate NAV of the units in the Redemption Basket. The purchase
            price
            for Creation Baskets and the redemption price for Redemption Baskets
            is the
            actual NAV calculated at the end of the business day when notice for
            a purchase
            or redemption is received by US12OF. The AMEX publishes an approximate
            intra-day
            NAV based on the prior day’s NAV and the current price of the
            Benchmark Futures Contracts, but the basket price is determined based on
            the actual NAV at the end of the day.
 While
          US12OF issues units only in Creation Baskets, units may also be
          purchased and sold in much smaller increments on the AMEX. These
          transactions, however, are effected at the bid and ask prices established
          by specialist firm(s). Like any listed security, units can be purchased
          and sold
          at any time a secondary market is open.


5


What
        is US12OF’s Investment
        Strategy?


In
          managing US12OF’s assets, the General Partner does not use a technical trading
          system that issues buy and sell orders. The General Partner instead employs
          a
          quantitative methodology whereby each time a Creation Basket is sold, the
          General Partner purchases Crude Oil Interests, such as the Benchmark Futures
          Contracts, that have an aggregate face amount that approximates the amount
          of
          Treasuries and/or cash received upon the issuance of the Creation
          Basket.
  As
            an
            example, assume that a Creation Basket is sold by US12OF, and that US12OF’s
            closing NAV per unit is $50.00.  In that case, US12OF would receive
            $5,000,000 in proceeds from the sale of the Creation Basket ($50 NAV
            per unit
            multiplied by 100,000 units, and ignoring the Creation Basket fee of
            $1,000).
  If
            one
            were to assume further that the General Partner wants to invest the entire
            proceeds from the Creation Basket in the Benchmark Futures Contracts
            and that
            the average face amount of the Benchmark Futures Contracts is $59,950,
            US12OF would be unable to buy the exact number of Benchmark Futures Contracts
            with an aggregate face amount equal to $5,000,000. Instead, US12OF would
            be able
            to purchase Benchmark Futures Contracts only with an aggregate face amount
            of
            $4,975,850. Assuming a margin requirement equal to 10% of the value of
            the
            Benchmark Futures Contract, US12OF would be required to deposit $497,585
            in
            Treasuries and cash with the futures commission merchant through which
            the
            Benchmark Futures Contracts were purchased. The remainder of the proceeds
            from
            the sale of the Creation Basket would remain invested in Treasuries,
            cash and/or
            cash equivalents as determined by the General Partner from time to time
            based on
            factors such as potential calls for margin or anticipated
            redemptions.
 
 The
            specific Futures Contracts to be purchased will depend on various factors,
            including a judgment by the General Partner as to the appropriate
            diversification of US12OF’s investments in futures contracts with respect to the
            month of expiration, and the prevailing price volatility of particular
            contracts. In addition, US12OF may make use of a mixture of standard
            sized
            futures contracts as well as the smaller sized “mini” contracts. While the
            General Partner anticipates significant investments in NYMEX futures
            contracts,
            as US12OF reaches certain position limits on the NYMEX, or for other
            reasons, it
            will invest in Futures Contracts traded on other exchanges or invest
            in Other
            Crude Oil-Related Investments such as contracts in the “over-the-counter”
market.
 
 The
            General Partner does not anticipate letting its Futures Contracts expire
            and
            taking delivery of the underlying crude oil. Instead, the General Partner
            will
            close existing positions when it is determined appropriate to do so and
            reinvest
            the proceeds in new Futures Contracts. Positions may also be closed out
            to meet
            orders for Redemption Baskets.
 
 By
            remaining invested as fully as possible in Futures Contracts or Other
            Crude
            Oil-Related Investments, the General Partner believes that the changes
            in
            percentage terms in US12OF’s NAV will closely track the changes in percentage
            terms in the prices of the futures contracts in which US12OF invests.
            The
            General Partner believes that certain arbitrage opportunities will result
            in the
            price of the units traded on the AMEX closely tracking the NAV of
            US12OF.
 6
 The
          specific Futures Contracts purchased depend on various factors, including a
          judgment by the General Partner as to the appropriate diversification of
          US12OF’s investments in futures contracts with respect to the month of
          expiration, and the prevailing price volatility of particular contracts.
          While
          the General Partner has made significant investments in NYMEX Futures
          Contracts, as US12OF reaches certain position limits on the
          NYMEX, or for other reasons, it may also invest in Futures Contracts
          traded on other exchanges or invest in Other Crude Oil Related Investments
          such
          as contracts in the “over-the-counter” market.
  What
          are Futures
          Contracts?
  Futures
          Contracts are agreements between two parties. One party agrees to buy crude
          oil
          from the other party at a later date at a price and quantity agreed upon
          when
          the contract is made. Futures Contracts are traded on futures exchanges.
For
          example, crude oil futures contracts traded on the NYMEX trade in units
          of 1,000
          barrels (a “mini” contract is 500 barrels).The price of crude oil
          futures contracts traded on the NYMEX are priced by floor brokers and other
          exchange members both through an “open outcry” of offers to purchase or sell the
          contracts and through an electronic, screen-based system that determines
          the
          price by matching electronically offers to purchase and sell.
  Certain
          typical and significant characteristics of Futures Contracts are discussed
          below. Additional risks of investing in Futures Contracts are included in
“What are the Risk Factors Involved with an Investment in US12OF?”
 Impact
            of Accountability Levels,
            Position Limits and Price Fluctuation Limits . Futures
            Contracts include typical and significant characteristics. Most significantly,
            the CFTC and U.S. designated contract markets such as the NYMEX have
            established
            accountability levels and position limits on the maximum net long or
            net short
            Futures Contracts in commodity interests that any person or group of
            persons
            under common trading control (other than as a hedge, which an investment
            in
            US12OF is not) may hold, own or control. The net position is the difference
            between an individual or firm’s open long contracts and open short contracts in
            any one commodity. In addition, most U.S. futures exchanges, such as
            the NYMEX,
            limit the daily price fluctuation for Futures Contracts.
 7
 
 The
              accountability levels for the Benchmark Futures Contract and
              other Futures Contracts traded on the NYMEX are not a fixed ceiling, but
              rather a threshold above which the NYMEX may exercise greater scrutiny
              and
              control over an investor’s positions. The current accountability level for
              investments at any one time in crude oil Futures Contracts (including
              investments in the Benchmark Oil Futures Contract) is 20,000 contracts.
              If
              US12OF exceeds this accountability level for investments in crude oil
              Futures
              Contracts, the NYMEX will monitor US12OF’s exposure and ask for further
              information on US12OF’s activities including the total size of all positions,
              investment and trading strategy, and the extent of US12OF’s liquidity resources.
              If deemed necessary by the NYMEX, it could also order US12OF to reduce
              its
              position back to the accountability level. As of December 31, 2007,
              US12OF held
              232 Futures Contracts traded on the NYMEX.
 If
            the
            NYMEX orders US12OF to reduce its position back to the accountability
            level, or
            to an accountability level that the NYMEX deems appropriate for US12OF,
            such an
            accountability level may impact the mix of investments in crude oil interests
            made by US12OF. To illustrate, assume that the Benchmark Futures
            Contract and the unit price of US12OF are each $50, and that the NYMEX
            has
            determined that US12OF may not own more than 20,000 contracts in crude oil
            Futures Contracts. In such case, US12OF could invest up to $1 billion
            of its
            daily net assets in the Benchmark Futures Contracts (i.e., $50 per contract
            multiplied by 1,000 (a Benchmark Futures Contracts is a contract for 1,000
            barrels, multiplied by 20,000 contracts)) before reaching the accountability
            level imposed by the NYMEX. Once the daily net assets of the portfolio
            exceed $1
            billion in the Benchmark Futures Contract, the portfolio may not be able to make any further investments
            in the
            Benchmark Futures Contract, depending on whether the NYMEX imposes limits.
            If the NYMEX does impose limits at the $1 billion level (or another level),
            US12OF anticipates that it will invest the majority of its assets above
            that
            level in a mix of other Futures Contracts or Other Crude Oil Related
            Investments.
  In
            addition to accountability levels, the NYMEX imposes position limits
            on
            contracts held in the last few days of trading in the near month contract
            to
            expire. It is unlikely that US12OF will run up against such position
            limits
            because US12OF’s investment strategy is to change or "roll" from the near month
            contract two weeks from expiration of the contract.
  U.S.
            futures exchanges, including the NYMEX, also limit the amount of price
            fluctuation for crude oil Futures Contracts. For example, the NYMEX imposes
            a $10.00 per barrel ($10,000 per contract) price fluctuation limit for
            Benchmark Futures Contracts. This limit is initially based off the previous
            trading day’s settlement price. If any Benchmark Futures Contract is traded,
            bid, or offered at the limit for five minutes, trading is halted for
            five
            minutes. When trading resumes, it begins at the point where the limit
            was
            imposed and the limit is reset to be $10.00 per barrel in either direction
            of
            that point. If another halt were triggered, the market would continue
            to be
            expanded by $10.00 per barrel in either direction after each successive
            five-minute trading halt. There is no maximum price fluctuation limit
            during any
            one trading session.
 8
 
 Examples
              of the position and price limits imposed are as follows:
 
 Futures
                          Contract
                      
                      Position
                          Accountability
                        Levels
                          and Limits
                      
                      Maximum
                          Daily
                        Price
                          FluctuationNYMEX
                          Light, Sweet Crude Oil
                      
                      Any
                          one month/all months: 20,000 net futures, but not to exceed
                          3,000
                          contracts in the last three days of trading in the spot
                          month.
                      
                      $10.00
                          per barrel ($10,000 per contract) for all months. If any
                          contract is
                          traded, bid, or offered at the limit for five minutes,
                          trading is halted
                          for five minutes. When trading resumes, the limit is expanded by $10.00
                          per barrel in either direction. If another halt were triggered,
                          the market
                          would continue to be expanded by $10.00 per barrel in either
                          direction
                          after each successive five-minute trading halt. There will
                          be no maximum
                          price fluctuation limits during any one trading
                          session.ICE
                          Futures Brent Crude Futures
                      
                      There
                          are no position limits.
                      
                      There
                          is no maximum daily price fluctuation limit.ICE
                          WTI Crude Futures
                      
                      There
                          are no position limits.
                      
                      There
                          is no maximum daily price fluctuation.NYMEX
                          Heating Oil
                      
                      Any
                          one month/all months: 7,000 net futures, but not to exceed
                          1,000 contracts
                          in the last three days of trading in the spot month
                      
                      $0.25
                          per gallon ($10,500 per contract) for all months. If any
                          contract is
                          traded, bid, or offered at the limit for five minutes,
                          trading is halted
                          for five minutes. When trading resumes, the limit is expanded
                          by $0.25 per
                          gallon in either direction. If another halt were triggered,
                          the market
                          would continue to be expanded by $0.25 per gallon in either
                          direction
                          after each successive five-minute trading halt. There will
                          be no maximum
                          price fluctuation limits during any one trading
                          session.NYMEX
                          Gasoline
                      
                      Any
                          one month/all months: 7,000 net futures, but not to exceed
                          1,000 contracts
                          in the last three days of trading in the spot month.
                      
                      $0.25
                          per gallon ($10,500 per contract) for all months. If any
                          contract is
                          traded, bid, or offered at the limit for five minutes,
                          trading is halted
                          for five minutes. When trading resumes, the limit is expanded
                          by $0.25 per
                          gallon in either direction. If another halt were triggered,
                          the market
                          would continue to be expanded by $0.25 per gallon in either
                          direction
                          after each successive five-minute trading halt. There will
                          be no maximum
                          price fluctuation limits during any one trading
                          session.NYMEX
                          Natural Gas
                      
                      Any
                          one month/all months: 12,000 net futures, but not to exceed
                          1,000
                          contracts in the last three days of trading in the spot
                          month.
                      
                      $3.00
                          per mmBtu ($30,000 per contract) for all months. If any
                          contract is
                          traded, bid, or offered at the limit for five minutes,
                          trading is halted
                          for five minutes. When trading resumes, the limit is expanded
                          by $3.00 per
                          mmBtu in either direction. If another halt were triggered,
                          the market
                          would continue to be expanded by $3.00 per mmBtu in either
                          direction after
                          each successive five-minute trading halt. There will be
                          no maximum price
                          fluctuation limits during any one trading
                          session.
 9
 
 Price
          Volatility. Despite
          daily price limits, the price volatility of Futures Contracts generally has
          been historically greater than that for traditional securities such as
          stocks
          and bonds. Price volatility often is greater day-to-day as opposed to
          intra-day. Crude oil Futures Contracts tend to be more volatile than stocks
          and bonds because price movements for crude oil are more currently and
          directly
          influenced by economic factors for which current data is available and
          are
          traded by crude oil futures traders throughout the day. These economic
          factors
          include: changes in interest rates; governmental, agricultural, trade,
          fiscal,
          monetary and exchange control programs and policies; weather and climate
          conditions; changing supply and demand relationships; changes in balances
          of
          payments and trade; U.S. and international rates of inflation; currency
          devaluations and revaluations; U.S. and international political and economic
          events; and changes in philosophies and emotions of market participants.
          Because
          US12OF invests a significant portion of its assets in Futures Contracts,
          the assets of US12OF, and therefore the prices of US12OF units, may be
          subject
          to greater volatility than traditional securities.
 Marking-to-Market
          Futures
          Positions. Futures Contracts are marked to market at the end of each
          trading day and the margin required with respect to such contracts is adjusted
          accordingly. This process of marking-to-market is designed to prevent losses
          from accumulating in any futures account. Therefore, if US12OF’s futures
          positions have declined in value, US12OF may be required to post variation
          margin to cover this decline. Alternatively, if US12OF futures positions
          have
          increased in value, this increase will be credited to US12OF’s
          account.
  What
          is the Crude Oil Market and the
          Petroleum-Based Fuel Market?
 Light,
              Sweet Crude Oil. Crude
              oil is the world’s most actively traded commodity. The Futures Contracts for
              light, sweet crude oil that are traded on the NYMEX are the world’s most liquid
              forum for crude oil trading, as well as the most liquid futures contracts
              on a
              physical commodity. Due to the liquidity and price transparency of
              oil Futures
              Contracts, they are used as a principal international pricing benchmark.
              The
              Futures Contracts for light, sweet crude oil trade on the NYMEX in
              units of
              1,000 U.S. barrels (42,000 gallons) and, if not closed out before maturity,
              will
              result in delivery of oil to Cushing, Oklahoma, which is also accessible
              to the
              world market by two major interstate petroleum pipeline
              systems.
 
 The
              price
              of crude oil is established by the supply and demand conditions in
              the global
              market overall, and more particularly, in the main refining centers
              of
              Singapore, Northwest Europe, and the U.S. Gulf Coast. Demand for petroleum
              products by consumers, as well as agricultural, manufacturing and transportation
              industries, determines demand for crude oil by refiners. Since the
              precursors of
              product demand are linked to economic activity, crude oil demand will
              tend to
              reflect economic conditions. However, other factors such as weather
              also
              influence product and crude oil demand.
 
 The
              price
              of light, sweet crude oil has historically exhibited periods of significant
              volatility.
  In
              Europe, Brent crude oil is the standard for
              futures contracts traded on the ICE Futures, an electronic marketplace
              for
              energy trading and price discovery. Brent crude oil is the price reference
              for
              two-thirds of the world's traded oil.
  10
 Heating
            Oil. Heating oil,
            also known as No. 2 fuel oil, accounts for 25% of the yield of a barrel
            of crude
            oil, the second largest “cut” from oil after gasoline. The heating oil futures
            contract, listed and traded on the NYMEX, trades in units of 42,000 gallons
            (1,000 barrels) and is based on delivery in the New York harbor, the
            principal
            cash market center.
 
 Gasoline.
            Gasoline is the
            largest single volume refined product sold in the U.S. and accounts for
            almost
            half of national oil consumption. The gasoline Futures Contract, listed
            and
            traded on the NYMEX, trades in units of 42,000 gallons (1,000 barrels)
            and is
            based on delivery at petroleum products terminals in the New York harbor,
            the
            major East Coast trading center for imports and domestic shipments from
            refineries in the New York harbor area or from the Gulf Coast refining
            centers.
            The price of gasoline is volatile.
 
 Natural
            Gas.  Natural gas accounts for almost a quarter of U.S. energy
            consumption. The natural gas futures contract, listed and traded on the
            NYMEX, trades in units of 10,000 million British thermal units (mmBtu)
            and is
            based on delivery at the Henry Hub in Louisiana, the nexus of 16 intra-
            and
            interstate natural gas pipeline systems that draw supplies from the region's
            prolific gas deposits. The pipelines serve markets throughout the U.S.
            East
            Coast, the Gulf Coast, the Midwest, and up to the Canadian border. The
            price of
            natural gas has historically been volatile.
  Why
          Does US12OF Purchase and
          Sell Futures Contracts?
  US12OF’s
          investment objective is to have the changes in percentage terms of the
          units’
NAV reflect the changes in percentage terms of the Benchmark Futures Contract,
          less US12OF’s expenses. US12OF invests primarily in Futures Contracts. US12OF
          seeks to have its aggregate NAV approximate at all times the aggregate
          face
          amount of the Futures Contracts and Other Crude Oil Related
          Investments it holds.
  Other
          than investing in Futures Contracts and Other Crude Oil Related
          Investments, US12OF only invests in assets to support these investments
          in crude
          oil interests. At any given time, most of US12OF’s investments will be in
          Treasuries, cash and/or cash equivalents that serve as segregated assets
          supporting US12OF’s positions in Futures Contracts and Other Crude Oil
          Related Investments. For example, the purchase of a Futures Contract with
          a
          stated value of $10 million would not require US12OF to pay $10 million
          upon
          entering into the contract; rather, only a margin deposit, generally of
          5% to
          10% of the stated value of the Futures Contract, would be required. To
          secure its Futures Contract obligations, US12OF would deposit the
          required margin with the futures commission merchant and would separately
          hold,
          through its Custodian, Treasuries, cash and/or cash equivalents in an
          amount equal to the balance of the current market value of the contract,
          which
          at the contract’s inception would be $10 million minus the amount of the margin
          deposit, or $9.5 million (assuming a 5% margin).
  As
          a
          result of the foregoing, typically only 5% to 10% of US12OF’s assets are held as
          margin in segregated accounts with the futures commission merchant. In
          addition to the Treasuries or cash it posts with the futures commission
          merchant
          for the Futures Contracts it owns, US12OF holds through the Custodian,
          Treasuries, cash and/or cash equivalents that can be posted as margin or as
          collateral to support its over-the-counter contracts. US12OF earns interest
          income from the Treasuries and/or
          cash equivalents that it purchases, and on the cash it holds through the
          Custodian. It anticipates that the earned interest income will increase
          the NAV
          and limited partners’ capital contribution accounts. US12OF reinvests the earned
          interest income, holds it in cash, or uses it to pay its expenses. If US12OF
          reinvests the earned interest income, it will make investments that are
          consistent with its investment objectives.
 11
 What
          is the Flow of
          Units?


What
        are the Trading Policies of
        US12OF?
  Liquidity
  US12OF
        invests only in Futures Contracts and Other Crude Oil Related Investments
        that are traded in sufficient volume to permit, in the opinion of the General
        Partner, ease of taking and liquidating positions in these financial interests.
        This can include both standard sized futures contracts as well as smaller
        sized
        mini contracts.
  Spot
        Commodities
  While
        the
        crude oil Futures Contracts traded on the NYMEX can be physically settled,
        US12OF does not intend to take or make physical delivery. However, US12OF
        may
        from time to time trade in Other Crude Oil Related Invetsments, including
        contracts based on the spot price of crude oil.
 12
 Leverage
  While
        US12OF’s historical ratio of margin to total assets has generally ranged
        from 0% to 5%, the General Partner endeavors to have the value of US12OF’s
        Treasuries, cash and/or cash equivalents, whether held by US12OF or posted
        as
        margin or collateral at all times, approximate the aggregate face value of
        US12OF's obligations under its Futures Contracts and Other Crude Oil Related
        Investments.
  Borrowings
  Borrowings
        are not used by US12OF, unless US12OF is required to borrow money in the
        event of physical delivery, if US12OF trades in cash commodities, or for
        short-term needs created by unexpected redemptions. US12OF expects to have
        the
        value of its Treasuries, cash and/or cash equivalents whether held by US12OF
        or
        posted as margin or collateral, at all times approximate the aggregate face
        value of its obligations under US12OF's Futures Contracts and Other Crude
        Oil
        Related Investments. US12OF has not established and does not plan to establish
        credit lines.
  Pyramiding
  US12OF
        has not and will not employ the technique, commonly known as pyramiding,
        in
        which the speculator uses unrealized profits on existing positions as variation
        margin for the purchase or sale of additional positions in the same or another
        commodity interest.
  Who
        are the Service
        Providers?
  BBH&Co.
        is the registrar and transfer agent for the units. BBH&Co. is also the
        Custodian for US12OF. In this capacity, BBH&Co. holds
        US12OF’s Treasuries, cash and/or cash equivalents pursuant to a
        custodial agreement. In addition, BBH&Co. performs certain administrative
        and accounting services for US12OF and prepares certain Securities and Exchange
        Commission ("SEC") and CFTC reports on behalf of US12OF. The General Partner
        pays BBH&Co. a fee for these services.
  US12OF
        also employs a Marketing Agent. The General Partner pays the Marketing
        Agent’s marketing fee of 0.06% on US12OF's assets up to $3 billion; and
        0.04% on US12OF's assets in excess of $3 billion.
  UBS
        Securities LLC (“UBS Securities”) is US12OF’s futures commission merchant.
        US12OF and UBS Securities have entered into an Institutional Futures Client
        Account Agreement. This Agreement requires UBS Securities to provide services
        to
        US12OF in connection with the purchase and sale of crude oil interests that
        may
        be purchased or sold by or through UBS Securities for US12OF’s account. US12OF
        pays the fees of UBS Securities.
  UBS
        Securities’ principal business address is 677 Washington Blvd, Stamford, CT
        06901. UBS Securities is a futures clearing broker for US12OF. UBS Securities
        is
        registered in the U.S. with the Financial Industry Regulatory
        Authority ("FINRA") as a broker-dealer and with the CFTC as a futures
        commission merchant. UBS Securities is a member of various U.S. futures and
        securities exchanges.
  UBS
        Securities is not affiliated with us or our General Partner. Therefore, US12OF
        does not believe that it has any conflicts of interest with them or their
        trading principals arising from their acting as our futures commission
        merchant.
  UBS
        Securities was involved in the 2003 Global Research Analyst Settlement. This
        settlement was part of the global settlement that UBS Securities and nine
        other
        firms reached with the SEC, FINRA, New York Stock Exchange ("NYSE") and
        various state regulators. As part of the settlement, UBS Securities agreed
        to pay $80,000,000 divided among retrospective relief, for procurement of
        independent research and for investor education. UBS Securities has also
        undertaken to adopt enhanced policies and procedures reasonably designed
        to
        address potential conflicts of interest arising from research
        practices.
  On
          June
          27, 2007, the Office of the Secretary of the Commonwealth of Massachusetts
          filed
          an administrative complaint (the “Complaint”) and notice of adjudicatory
          proceeding, captioned In The Matter of UBS Securities, LLC, Docket No.
          E-2007-0049, which alleges, in sum and substance, that UBS Securities has
          been
          violating the Massachusetts Uniform Securities Act (the “MUSA”) and related
          regulations by providing the advisers for certain hedge funds with gifts
          and
          gratuities in the form of below market office rents, personal loans with
          below
          market interest rates, event tickets and other perks, in order to induce
          those
          hedge fund advisers to increase or retain their level of prime brokerage
          fees
          paid to UBS Securities.  The Secretary seeks to require UBS Securities
          to permanently cease and desist from conduct that violates the MUSA and
          regulations, to censure UBS Securities, to require UBS Securities to pay
          an
          administrative fine of an unspecified amount, and to find as fact the
          allegations of the Complaint.
 13
 Further,
        UBS Securities, like most large, full service investment banks and
        broker-dealers, receives inquiries and is sometimes involved in investigations
        by the SEC, FINRA, NYSE and various other regulatory organizations,
        exchanges and government agencies. UBS Securities fully cooperates with the
        authorities in all such requests. UBS
        Securities regularly discloses to FINRA arbitration awards, disciplinary
        action
        and regulatoryevents.
        These disclosures are publicly available on FINRA’s website at www.finra.org.
        Actions with respect to UBS Securities’ futures commission merchant business are
        publicly available on the website of the NFA(www.nfa.futures.org).
  UBS
        Securities acts only as clearing broker for US12OF and, as such, is paid
        commissions for executing and clearing trades on behalf of US12OF. UBS
        Securities neither acts in any supervisory capacity with respect to the General
        Partner nor participates in the management of the General Partner or
        US12OF.
  Currently,
        the General Partner does not employ commodity trading advisors. If, in the
        future, the General Partner does employ commodity trading advisors, it will
        choose each advisor based on arms-length negotiations and will consider the
        advisor’s experience, fees and reputation.
  Fees
          and Compensation Arrangements with the General Partner and Non-Affiliated
          Service Providers*
 
 Service
                    Provider
                Compensation
                    Paid by the General PartnerBrown
                    Brothers Harriman & Co., Custodian and Administrator
                Minimum
                    amount of $125,000 annually* for its custody, fund accounting
                    and fund
                    administration services rendered to all funds, as well as a $25,000
                    annual
                    fee for its transfer agency services. In addition, an asset-based
                    charge
                    of (a) 0.06% for the first $500 million of US12OF, USOF, USNG and
                    USG’s combined assets, (b) 0.0465% for US12OF, USOF, USNG and USG’s
                    combined assets greater than $500 million but less than $1 billion,
                    and
                    (c) 0.035% once US12OF, USOF, USNG and USG’s combined net assets exceed $1
                    billion.**ALPS
                    Distributors, Inc., Marketing Agent
                0.06%
                    on assets up to $3 billion; 0.04% on assets in excess of $3
                    billion.**
 *  
          The annual minimum amount will not apply if the asset-based charge for
          all
          accounts in the aggregate exceeds $125,000. The General Partner also will
          pay
          transaction charge fees to BBH&Co., ranging from $7.00 to $15.00 per
          transaction for the funds.
 **
          The
          General Partner pays this compensation.
 
 Service
                    Provider
                Compensation
                    Paid by US12OFNon-Affiliated
                    Brokers
                Approximately
                    0.016% of assets (including futures commission merchant fees
                    of
                    approximately $4.00 per buy or
                    sell)***
 ***
          US12OF pays this compensation.
 14
  New
            York Mercantile Exchange Licensing Fee****
 
 Assets
                  Licensing
                      FeeFirst
                      $1,000,000,000
                  0.04%
                      of NAVAfter
                      the first $1,000,000,000
                  0.02%
                      of NAV
  ****  
            Fees are calculated on a daily basis (accrued at 1/365 of the applicable
            percentage of NAV on that day) and paid on a monthly basis. US12OF is
            responsible for its pro rata share of the assets held by USOF, USNG,
            US12OF and
            USG as well as other funds managed by the General Partner, including US12NG
            and USHO, when and if such funds commence operations.
 Form
          of Units
  Registered
          Form .
          Units
          are issued in registered form in accordance with the LP Agreement. The
          Administrator has been appointed registrar and transfer agent for the purpose
          of
          transferring units in certificated form. The Administrator keeps a record
          of all
          holders of the units in the registry (the “Register”). The General Partner
          recognizes transfers of units in certificated form only if done in accordance
          with the LP Agreement. The beneficial interests in such units are held
          in
          book-entry form through participants and/or accountholders in the Depository
          Trust Company ("DTC").
  Book
          Entry .
          Individual certificates are not issued for the units. Instead, units are
          represented by one or more global certificates, which are deposited by
          the
          Administrator with DTC and registered in the name of Cede & Co., as
          nominee for DTC. The global certificates evidence all of the units outstanding
          at any time. Unitholders are limited to (1) participants in DTC such as
          banks, brokers, dealers and trust companies ("DTC Participants"), (2) those
          who maintain, either directly or indirectly, a custodial relationship with
          a DTC
          Participant ("Indirect Participants"), and (3) those banks, brokers,
          dealers, trust companies and others who hold interests in the units through
          DTC
          Participants or Indirect Participants, in each case who satisfy the requirements
          for transfers of units. DTC Participants acting on behalf of investors
          holding
          units through such participants’ accounts in DTC will follow the delivery
          practice applicable to securities eligible for DTC’s Same-Day Funds Settlement
          System. Units are credited to DTC Participants’ securities accounts following
          confirmation of receipt of payment.
  DTC .
          DTC is
          a limited purpose trust company organized under the laws of the State of
          New
          York and is a member of the Federal Reserve System, a “clearing corporation”
within the meaning of the New York Uniform Commercial Code and a “clearing
          agency” registered pursuant to the provisions of Section 17A of the Securities
          Exchange Act of 1934, as amended (the “Exchange Act”). DTC holds securities for
          DTC Participants and facilitates the clearance and settlement of transactions
          between DTC Participants through electronic book-entry changes in accounts
          of
          DTC Participants.
 15
 Transfer
          of Units
  Transfers
          of Units Only Through
          DTC. The units are only transferable through the book-entry
          system
          of DTC. Limited partners who are not DTC Participants may transfer their
          units
          through DTC by instructing the DTC Participant holding their units (or
          by
          instructing the Indirect Participant or other entity through which their
          units
          are held) to transfer the units. Transfers are made in accordance with
          standard
          securities industry practice.
  Transfers
          of interests in units with DTC will be made in accordance with the usual
          rules
          and operating procedures of DTC and the nature of the transfer. DTC has
          established procedures to facilitate transfers among the participants and/or
          accountholders of DTC. Because DTC can only act on behalf of DTC Participants,
          who in turn act on behalf of Indirect Participants, the ability of a person
          or
          entity having an interest in a global certificate to pledge such interest
          to
          persons or entities that do not participate in DTC, or otherwise take actions
          in
          respect of such interest, may be affected by the lack of a definitive security
          in respect of such interest.
  DTC
          has
          advised us that it will take any action permitted to be taken by a unitholder
          (including, without limitation, the presentation of a global certificate
          for
          exchange) only at the direction of one or more DTC Participants in whose
          account
          with DTC interests in global certificates are credited and only in respect
          of
          such portion of the aggregate principal amount of the global certificate
          as to
          which such DTC Participant or Participants has or have given such
          direction.
  Transfer/Application
          Requirements. All purchasers of US12OF’s units, and potentially
          any purchasers of units in the future, who wish to become limited partners
          or
          other record holders and receive cash distributions, if any, or have certain
          other rights, must deliver an executed transfer application in which the
          purchaser or transferee must certify that, among other things, he, she
          or it
          agrees to be bound by US12OF’s LP Agreement and is eligible to purchase US12OF’s
          securities. Each purchaser of units must execute a transfer application
          and
          certification. The obligation to provide the form of transfer application
          will
          be imposed on the seller of units or, if a purchase of units is made through
          an
          exchange, the form may be obtained directly through US12OF. Further, the
          General
          Partner may request each record holder to furnish certain information,
          including
          that holder’s nationality, citizenship or other related status. A record holder
          is a unitholder that is, or has applied to be, a limited partner. An investor
          who is not a U.S. resident may not be eligible to become a record holder
          or one
          of the US12OF’s limited partners if that investor’s ownership would subject
          US12OF to the risk of cancellation or forfeiture of any of US12OF’s assets under
          any federal, state or local law or regulation. If the record holder fails
          to
          furnish the information or if the General Partner determines, on the basis
          of
          the information furnished by the holder in response to the request, that
          such
          holder is not qualified to become one of US12OF’s limited partners, the General
          Partner may be substituted as a holder for the record holder, who will
          then be
          treated as a non-citizen assignee, and US12OF will have the right to redeem
          those securities held by the record holder.
  A
          transferee’s broker, agent or nominee may complete, execute and deliver a
          transfer application and certification. US12OF may, at its discretion,
          treat the
          nominee holder of a unit as the absolute owner. In that case, the beneficial
          holder’s rights are limited solely to those that it has against the nominee
          holder as a result of any agreement between the beneficial owner and the
          nominee
          holder.
  A
          person
          purchasing US12OF’s existing units, who does not execute a transfer application
          and certify that the purchaser is eligible to purchase those securities
          acquires
          no rights in those securities other than the right to resell those securities.
          Whether or not a transfer application is received or the consent of the
          General
          Partner obtained, our units will be securities and will be transferable
          according to the laws governing transfers of securities.
 16
 Any
          transfer of units will not be recorded by the transfer agent or recognized
          by
          the General Partner unless a completed transfer application is delivered
          to the
          General Partner or the Administrator. When acquiring units, the transferee
          of
          such units that completes a transfer application will:
  · be
          an
          assignee until admitted as a substituted limited partner upon the consent
          and
          sole discretion of the General Partner and the recording of the assignment
          on
          the books and records of the partnership;
 · automatically
          request admission as a substituted limited partner;
 · agree
          to
          be bound by the terms and conditions of, and execute, our LP
          Agreement;
 · represent
          that such transferee has the capacity and authority to enter into our LP
          Agreement;
 · grant
          powers of attorney to our General Partner and any liquidator of us;
          and
 · make
          the
          consents and waivers contained in our LP Agreement.
  An
          assignee will become a limited partner in respect of the transferred units
          upon
          the consent of the General Partner and the recordation of the name of the
          assignee on our books and records. Such consent may be withheld in the
          sole
          discretion of the General Partner.
  If
          consent of the General Partner is withheld, such transferee shall be an
          assignee. An assignee shall have an interest in the partnership equivalent
          to
          that of a limited partner with respect to allocations and distributions,
          including, without limitation, liquidating distributions, of the partnership.
          With respect to voting rights attributable to units that are held by assignees,
          the General Partner shall be deemed to be the limited partner with respect
          thereto and shall, in exercising the voting rights in respect of such units
          on
          any matter, vote such units at the written direction of the assignee who
          is the
          record holder of such units. If no such written direction is received,
          such
          units will not be voted. An assignee shall have no other rights of a limited
          partner.
  Until
          a
          unit has been transferred on US12OF's books, we and the transfer agent
          may treat
          the record holder of the unit as the absolute owner for all purposes, except
          as
          otherwise required by law or stock exchange regulations.
  Withdrawal
          of Limited
          Partners
  As
          discussed in the LP Agreement, if the General Partner gives at least fifteen
          (15) days’ written notice to a limited partner, then the General Partner may for
          any reason, in its sole discretion, require any such limited partner to
          withdraw
          entirely from the partnership or to withdraw a portion of its partner capital
          account. If the General Partner does not give at least fifteen (15) days’
written notice to a limited partner, then it may only require withdrawal
          of all
          or any portion of the capital account of any limited partner in the following
          circumstances: (i) the unitholder made a misrepresentation to the General
          Partner in connection with its purchase of units; or (ii) the limited
          partner’s ownership of units would result in the violation of any law or
          regulations applicable to the partnership or a partner. In these circumstances,
          the General Partner without notice may require the withdrawal at any time,
          or
          retroactively. The limited partner thus designated shall withdraw from
          the
          partnership or withdraw that portion of its partner capital account specified,
          as the case may be, as of the close of business on such date as determined
          by
          the General Partner. The limited partner thus designated shall be deemed
          to have
          withdrawn from the partnership or to have made a partial withdrawal from
          its
          partner capital account, as the case may be, without further action on
          the part
          of the limited partner and the provisions of the LP Agreement shall
          apply.
 17
 Calculating
          NAV
  US12OF’s
          NAV is calculated by:
  ·
                Taking
                    the current market value of its total
                    assets
 ·
                Subtracting
                    any liabilities
  The
          Administrator calculates the NAV of US12OF once each trading day. The NAV
          for a
          particular trading day is released after 4:15 p.m. New York time. It calculates
          the NAV as of the earlier of the close of the NYSE or 4:00 p.m. New York
          time.
          Trading on the AMEX typically closes at 4:15 p.m. New York time. US12OF
          uses the
          NYMEX closing price (determined at the earlier of the close of that Exchange
          or
          2:30 p.m. New York time) for the contracts held on the NYMEX, but calculates
          or
          determines the value of all other US12OF investments as of the earlier
          of the
          close of the NYSE or 4:00 p.m. New York time.
  In
          addition, in order to provide updated information relating to US12OF for
          use by
          investors and market professionals, the AMEX calculates and disseminates
          throughout the trading day an updated indicative fund value. The indicative
          fund
          value is calculated by using the prior day’s closing NAV per unit of US12OF as a
          base and updating that value throughout the trading day to reflect changes
          in
          the most recently reported trade price for the Benchmark Futures Contracts
          on the NYMEX. The prices reported for the active Benchmark Futures Contract
          month are adjusted based on the prior day’s spread differential between
          settlement values for that contract and the spot month contract. In the
          event
          that the spot month contract is also the active contract, the last sale
          price
          for the active contract is not adjusted. The indicative fund value unit
          basis
          disseminated during AMEX trading hours should not be viewed as an actual
          real
          time update of the NAV, because the NAV is calculated only once at the
          end of
          each trading day.
  The
          indicative fund value is disseminated on a per unit basis every 15 seconds
          during regular AMEX trading hours of 9:30 a.m. New York time to 4:15 p.m.
          New
          York time. The normal trading hours of the NYMEX are 10:00 a.m. New York
          time to
          2:30 p.m. New York time. This means that there is a gap in time at the
          beginning
          and the end of each day during which US12OF’s units are traded on the AMEX, but
          real-time NYMEX trading prices for oil futures contracts traded on the
          NYMEX are
          not available. As a result, during those gaps there will be no update to
          the
          indicative fund value.
  The
          AMEX
          disseminates the indicative fund value through the facilities of CTA/CQ
          High
          Speed Lines. In addition, the indicative fund value is published on the
          AMEX’s
          website and is available through on-line information services such as Bloomberg
          and Reuters.
  Dissemination
          of the indicative fund value provides additional information that is not
          otherwise available to the public and is useful to investors and market
          professionals in connection with the trading of US12OF units on the AMEX.
          Investors and market professionals are able throughout the trading day
          to
          compare the market price of US12OF and the indicative fund value. If the
          market
          price of US12OF units diverges significantly from the indicative fund value,
          market professionals will have an incentive to execute arbitrage trades.
          For
          example, if US12OF appears to be trading at a discount compared to the
          indicative fund value, a market professional could buy US12OF units on
          the AMEX
          and sell short futures contracts. Such arbitrage trades can tighten the
          tracking between the market price of US12OF and the indicative fund value
          and
          thus can be beneficial to all market participants.
  In
          addition, other Futures Contracts, Other Crude Oil Related Investments
          and Treasuries held by US12OF are valued by the Administrator, using rates
          and
          points received from client approved third party vendors (such as Reuters
          and WM
          Company) and advisor quotes. These investments are not included in the
          indicative value. The indicative fund value is based on the prior day’s NAV and
          moves up and down according solely to changes in the average of the price
          of
          the Benchmark Futures Contracts.
 18
 Creation
          and Redemption of
          Units
  US12OF
          creates and redeems units from time to time, but only in one or more Creation
          Baskets or Redemption Baskets. The creation and redemption of baskets are
          only
          made in exchange for delivery to US12OF or the distribution by US12OF of
          the
          amount of Treasuries and any cash represented by the baskets being created
          or
          redeemed, the amount of which is based on the combined NAV of the number
          of
          units included in the baskets being created or redeemed determined as of
          4:00
          p.m. New York time on the day the order to create or redeem baskets is
          properly
          received.
  Authorized
          Purchasers are the only persons that may place orders to create and redeem
          baskets. Authorized Purchasers must be (1) registered broker-dealers or
          other
          securities market participants, such as banks and other financial institutions,
          that are not required to register as broker-dealers to engage in securities
          transactions as described below, and (2) DTC Participants. To become an
          Authorized Purchaser, a person must enter into an Authorized Purchaser
          Agreement
          with the General Partner. The Authorized Purchaser Agreement provides the
          procedures for the creation and redemption of baskets and for the delivery
          of
          the Treasuries and any cash required for such creations and redemptions.
          The
          Authorized Purchaser Agreement and the related procedures attached thereto
          may
          be amended by US12OF, without the consent of any limited partner or unitholder
          or Authorized Purchaser. Authorized Purchasers pay a transaction fee of
          $1,000
          to US12OF for each order they place to create or redeem one or more baskets.
          Authorized Purchasers who make deposits with US12OF in exchange for baskets receive
          no fees, commissions or other form of compensation or inducement of any
          kind
          from either US12OF or the General Partner, and no such person will have
          any
          obligation or responsibility to the General Partner or US12OF to effect
          any sale
          or resale of units. As of December 31, 2007, 2 Authorized Purchasers had
          entered
          into agreements with US12OF to purchase Creation Baskets.
 Certain
            Authorized Purchasers are expected to have the facility to participate
            directly
            in the physical crude oil market and the crude oil futures market. In
            some
            cases, an Authorized Purchaser or its affiliates may from time to time
            acquire
            crude oil or sell crude oil and may profit in these instances. The General
            Partner believes that the size and operation of the crude oil market
            make it
            unlikely that an Authorized Purchaser’s direct activities in the crude oil or
            securities markets will impact the price of crude oil, Futures Contracts,
            or the
            price of the units.
  Each
          Authorized Purchaser is required to be registered as a broker-dealer under
          the
          Exchange Act and is a member in good standing with FINRA, or exempt from
          being
          or otherwise not required to be licensed as a broker-dealer or a member
          of
          FINRA, and qualified to act as a broker or dealer in the states or other
          jurisdictions where the nature of its business so requires. Certain Authorized
          Purchasers may also be regulated under federal and state banking laws and
          regulations. Each Authorized Purchaser has its own set of rules and procedures,
          internal controls and information barriers as it determines is appropriate
          in
          light of its own regulatory regime.
  Under
          the
          Authorized Purchaser Agreement, the General Partner has agreed to indemnify
          the
          Authorized Purchasers against certain liabilities, including liabilities
          under
          the Securities Act of 1933, as amended, and to contribute to the payments
          the
          Authorized Purchasers may be required to make in respect of those
          liabilities.
  The
          following description of the procedures for the creation and redemption
          of
          baskets is only a summary and an investor should refer to the relevant
          provisions of the LP Agreement and the form of Authorized Purchaser Agreement
          for more detail, each of which is attached as an exhibit to this annual
          report
          on Form 10-K.
  Creation
          Procedures
  On
          any
          business day, an Authorized Purchaser may place an order with the Marketing
          Agent to create one or more baskets. For purposes of processing purchase
          and
          redemption orders, a “business day” means any day other than a day when any of
          the AMEX, the NYMEX or the NYSE is closed for regular trading. Purchase
          orders
          must be placed by 12:00 p.m. New York time or the close of regular trading
          on
          the AMEX, whichever is earlier; except in the case of the initial Authorized
          Purchaser’s or any other Authorized Purchaser’s initial order to purchase one or
          more Creation Baskets on the first day the baskets are to be offered and
          sold,
          when such orders shall be placed by 9:00 a.m. New York time on the day
          agreed to
          by the General Partner and the initial Authorized Purchaser. The day on
          which
          the Marketing Agent receives a valid purchase order is the purchase order
          date.
  By
          placing a purchase order, an Authorized Purchaser agrees to deposit Treasuries,
          cash or a combination of Treasuries and cash with US12OF,  as
          described below. Prior to the delivery of baskets for a purchase order,
          the
          Authorized Purchaser must also have wired to the Custodian the non-refundable
          transaction fee due for the purchase order. Authorized Purchasers may not
          withdraw a creation request.
 The
            manner by which creations are made is dictated by the terms of the Authorized
            Purchaser Agreement. By placing a purchase order, an Authorized Purchaser
            agrees
            to (1) deposit Treasuries, cash, or a combination of Treasuries and cash
            with
            the Custodian of US12OF, and (2) enter into or arrange for a block trade,
            an
            exchange for physical or exchange for swap, or any other over-the-counter
            energy
            transaction (through itself or a designated acceptable broker) with US12OF
            for
            the purchase of a number and type of futures contracts at the closing
            settlement
            price for such contracts on the purchase order date. If an Authorized Purchaser
            fails to consummate (1) and (2), the order shall be cancelled. The number
            and
            type of contracts specified shall be determined by the General Partner,
            in its
            sole discretion, to meet US12OF’s investment objective and shall be purchased as
            a result of the Authorized Purchaser’s purchase of units.
 
 Determination
            of Required Deposits
 
 The
            total deposit required to create each basket (“Creation Basket Deposit”) is the
            amount of Treasuries and/or cash that is in the same proportion to the
            total
            assets of US12OF (net of estimated accrued but unpaid fees, expenses
            and other
            liabilities) on the date the order to purchase is accepted as the number
            of
            units to be created under the purchase order is in proportion to the
            total
            number of units outstanding on the date the order is received. The General
            Partner determines, directly in its sole discretion or in consultation
            with the
            Administrator, the requirements for Treasuries and the amount of cash,
            including
            the maximum permitted remaining maturity of a Treasury and proportions
            of
            Treasury and cash that may be included in deposits to create baskets.
            The
            Marketing Agent publishes such requirements at the beginning of each
            business
            day. The amount of cash deposit required is the difference between the
            aggregate
            market value of the Treasuries required to be included in a Creation
            Basket
            Deposit as of 4:00 p.m. New York time on the date the order to purchase
            is
            properly received and the total required deposit.
 
 Delivery
            of Required Deposits
 
 An
            Authorized Purchaser who places a purchase order is responsible for transferring
            to US12OF’s account with the Custodian the required amount of Treasuries and
            cash by the end of the third business day following the purchase order
            date.
            Upon receipt of the deposit amount, the Administrator directs DTC to
            credit the
            number of baskets ordered to the Authorized Purchaser’s DTC account on the third
            business day following the purchase order date. The expense and risk
            of delivery
            and ownership of Treasuries until such Treasuries have been received
            by the
            Custodian on behalf of US12OF shall be borne solely by the Authorized
            Purchaser.
  Because
            orders to purchase baskets must be placed by 12:00 p.m., New York time,
            but the
            total payment required to create a basket during the continuous offering
            period
            will not be determined until 4:00 p.m., New York time, on the date the
            purchase
            order is received, Authorized Purchasers will not know the total amount
            of the
            payment required to create a basket at the time they submit an irrevocable
            purchase order for the basket. US12OF’s NAV and the total amount of the payment
            required to create a basket could rise or fall substantially between
            the time an
            irrevocable purchase order is submitted and the time the amount of the
            purchase
            price in respect thereof is determined.
 19
 Rejection
            of Purchase Orders
 
 The
            General Partner acting by itself or through the Marketing Agent may reject
            a
            purchase order or a Creation Basket Deposit if:
 
 ·
                  it
                      determines that the investment alternative available to US12OF
                      at that
                      time will not enable it to meet its investment
                      objective;
 ·
                  it
                      determines that the purchase order or the Creation Basket Deposit
                      is not
                      in proper form;
 ·
                  it
                      believes that the purchase order or the Creation Basket Deposit
                      would have
                      adverse tax consequences to US12OF or its
                      unitholders;
 ·
                  the
                      acceptance or receipt of the Creation Basket Deposit would,
                      in the opinion
                      of counsel to the General Partner, be unlawful;
                      or
 ·
                  circumstances
                      outside the control of the General Partner, Marketing Agent
                      or Custodian
                      make it, for all practical purposes, not feasible to process
                      creations of
                      baskets.
  None
            of the General Partner, Marketing Agent or Custodian will be liable for
            the
            rejection of any purchase order or Creation Basket
            Deposit.
  Redemption
          Procedures
  The
          procedures by which an Authorized Purchaser can redeem one or more baskets
          mirror the procedures for the creation of baskets. On any business day,
          an
          Authorized Purchaser may place an order with the Marketing Agent to redeem
          one
          or more baskets. Redemption orders must be placed by 12:00 p.m. New York
          time or
          the close of regular trading on the NYMEX, whichever is earlier. A redemption
          order so received will be effective on the date it is received in satisfactory
          form by the Marketing Agent. The redemption procedures allow Authorized
          Purchasers to redeem baskets and do not entitle an individual unitholder
          to
          redeem any units in an amount less than a Redemption Basket, or to redeem
          baskets other than through an Authorized Purchaser. By placing a redemption
          order, an Authorized Purchaser agrees to deliver the baskets to be redeemed
          through DTC’s book-entry system to US12OF not later than 3:00 p.m. New York time
          on the third business day following the effective date of the redemption
          order.
          Prior to the delivery of the redemption distribution for a redemption order,
          the
          Authorized Purchaser must also have wired to US12OF’s account at the Custodian
          the non-refundable transaction fee due for the redemption order. Authorized
          Purchasers may not withdraw a redemption request.
  The
            manner by which redemptions are made is dictated by the terms of the
            Authorized
            Purchaser Agreement. By placing a redemption order, an Authorized Purchaser
            agrees to (1) deliver the Redemption Basket to be redeemed through DTC’s
            book-entry system to US12OF’s account with the Custodian not later than 3:00
            p.m. New York time on the third business day following the effective
            date of the
            redemption order (“Redemption Distribution Date”), and (2) enter into or arrange
            for a block trade, an exchange for physical or exchange for swap, or
            any other
            over-the-counter energy transaction (through itself or a designated acceptable
            broker) with US12OF for the sale of a number and type of futures contracts
            at
            the closing settlement price for such contracts on the redemption order
            date. If
            an Authorized Purchaser fails to consummate (1) and (2) above, the order
            shall
            be cancelled. The number and type of contracts specified shall be determined
            by
            the General Partner, in its sole discretion, to meet US12OF’s investment
            objective and shall be sold as a result of the Authorized Purchaser’s sale of
            units. Prior to the delivery of the redemption distribution for a redemption
            order, the Authorized Purchaser must also have wired to US12OF’s account at the
            Custodian the non-refundable transaction fee due for the redemption
            order.
 
 Determination
            of Redemption Distribution
 
 The
            redemption distribution from US12OF consists of a transfer to the redeeming
            Authorized Purchaser of an amount of Treasuries and/or cash that is in
            the same
            proportion to the total assets of US12OF (net of estimated accrued but
            unpaid
            fees, expenses and other liabilities) on the date the order to redeem
            is
            properly received as the number of units to be redeemed under the redemption
            order is in proportion to the total number of units outstanding on the
            date the
            order is received. The General Partner, directly or in consultation with
            the
            Administrator, determines the requirements for Treasuries and the amounts
            of
            cash, including the maximum permitted remaining maturity of a Treasury,
            and the
            proportions of Treasuries and cash that may be included in distributions
            to
            redeem baskets. The Marketing Agent publishes such requirements as of
            4:00 p.m.
            New York time on the redemption order date.
 
 Delivery
            of Redemption Distribution
 
 The
            redemption distribution due from US12OF will be delivered to the Authorized
            Purchaser by 3:00 p.m. New York time on the third business day following
            the
            redemption order date if, by 3:00 p.m. New York time on such third business
            day,
            US12OF’s DTC account has been credited with the baskets to be redeemed. If
            US12OF’s DTC account has not been credited with all of the baskets to be
            redeemed by such time, the redemption distribution will be delivered
            to the
            extent of whole baskets received. Any remainder of the redemption distribution
            will be delivered on the next business day to the extent of remaining
            whole
            baskets received if US12OF receives the fee applicable to the extension
            of the
            redemption distribution date which the General Partner may, from time
            to time,
            determine and the remaining baskets to be redeemed are credited to US12OF’s DTC
            account by 3:00 p.m. New York time on such next business day. Any further
            outstanding amount of the redemption order shall be cancelled. Pursuant
            to
            information from the General Partner, the Custodian will also be authorized
            to
            deliver the redemption distribution notwithstanding that the baskets
            to be
            redeemed are not credited to US12OF’s DTC account by 3:00 p.m. New York time on
            the third business day following the redemption order date if the Authorized
            Purchaser has collateralized its obligation to deliver the baskets through
            DTC’s
            book entry-system on such terms as the General Partner may from time
            to time
            determine.
 
 Suspension
            or Rejection of Redemption Orders
 
 The
            General Partner may, in its discretion, suspend the right of redemption,
            or
            postpone the redemption settlement date, (1) for any period during which
            the
            AMEX or the NYMEX is closed other than customary weekend or holiday
            closings, or trading on the AMEX or the NYMEX is suspended or restricted,
            (2)
            for any period during which an emergency exists as a result of which
            delivery,
            disposal or evaluation of Treasuries is not reasonably practicable, or
            (3) for
            such other period as the General Partner determines to be necessary for
            the
            protection of the limited partners. None of the General Partner, the
            Marketing
            Agent, the Administrator, or the Custodian will be liable to any person
            or in
            any way for any loss or damages that may result from any such suspension
            or
            postponement.
 
 The
            General Partner will reject a redemption order if the order is not in
            proper
            form as described in the Authorized Purchaser Agreement or if the fulfillment
            of
            the order, in the opinion of its counsel, might be unlawful. The General
            Partner
            may also reject a redemption order if the number of units being redeemed
            would
            reduce the remaining outstanding units to 100,000 units (i.e., one basket)
            or
            less, unless the General Partner has reason to believe that the placer
            of the
            redemption order does in fact possess all the outstanding units and can
            deliver
            them.
  Creation
          and Redemption Transaction
          Fee
  To
          compensate US12OF for its expenses in connection with the creation and
          redemption of baskets, an Authorized Purchaser is required to pay a transaction
          fee to US12OF of $1,000 per order to create or redeem baskets. An order
          may
          include multiple baskets. The transaction fee may be reduced, increased
          or
          otherwise changed by the General Partner. The General Partner shall notify
          DTC
          of any change in the transaction fee and will not implement any increase
          in the
          fee for the redemption of baskets until 30 days after the date of the
          notice.
  Tax
          Responsibility
  Authorized
          Purchasers are responsible for any transfer tax, sales or use tax, stamp
          tax,
          recording tax, value added tax or similar tax or governmental charge applicable
          to the creation or redemption of baskets, regardless of whether or not
          such tax
          or charge is imposed directly on the Authorized Purchaser, and agree to
          indemnify the General Partner and US12OF if they are required by law to
          pay any
          such tax, together with any applicable penalties, additions to tax or interest
          thereon.
  Secondary
          Market
          Transactions
  As
          noted,
          US12OF will create and redeem units from time to time, but only in one
          or more
          Creation Baskets or Redemption Baskets. The creation and redemption of
          baskets
          will only be made in exchange for delivery to US12OF or
          the
          distribution by US12OF of the amount of Treasuries and cash represented
          by the
          baskets being created or redeemed, the amount of which will be based on
          the
          aggregate NAV of the number of units included in the baskets being created
          or
          redeemed determined on the day the order to create or redeem baskets is
          properly
          received.
 20
 As
          discussed above, Authorized Purchasers are the only persons that may place
          orders to create and redeem baskets. Authorized Purchasers must be registered
          broker-dealers or other securities market participants, such as banks and
          other
          financial institutions that are not required to register as broker-dealers
          to
          engage in securities transactions. An Authorized Purchaser is under no
          obligation to create or redeem baskets, and an Authorized Purchaser is
          under no
          obligation to offer to the public units of any baskets it does create.
          Authorized Purchasers that do offer to the public units from the baskets
          they
          create will do so at per-unit offering prices that are expected to reflect,
          among other factors, the trading price of the units on the AMEX, the NAV
          of
          US12OF at the time the Authorized Purchaser purchased the Creation Baskets
          and
          the NAV at the time of the offer of the units to the public, the supply of
          and demand for units at the time of sale, and the liquidity of the Futures
          Contract market and the market for Other Crude Oil Related Investments.
          The
          prices of units offered by Authorized Purchasers are expected to fall between
          US12OF’s NAV and the trading price of the units on the AMEX at the time of sale.
          Units initially comprising the same basket but offered by Authorized Purchasers
          to the public at different times may have different offering prices. An
          order
          for one or more baskets may be placed by an Authorized Purchaser on behalf
          of
          multiple clients. Authorized Purchasers who make deposits with US12OF in
          exchange for baskets receive no fees, commissions or other form of compensation
          or inducement of any kind from either US12OF or the General Partner, and
          no such
          person has any obligation or responsibility to the General Partner or US12OF
          to
          effect any sale or resale of units. Units are expected to trade in the
          secondary
          market on the AMEX. Units may trade in the secondary market at prices that
          are
          lower or higher relative to their NAV per unit. The amount of the discount
          or
          premium in the trading price relative to the NAV per unit may be influenced
          by
          various factors, including the number of investors who seek to purchase
          or sell
          units in the secondary market and the liquidity of the Futures Contracts
          market
          and the market for Other Crude Oil Related Investments. While the units
          trade on the AMEX until 4:15 p.m. New York time, liquidity in the market
          for
          Futures Contracts and Other Crude Oil Related Investments may be reduced
          after
          the close of the NYMEX at 2:30 p.m. New York time. As a result, during
          this
          time, trading spreads, and the resulting premium or discount, on the units
          may
          widen.
  Prior
            Performance of US12OF and
            Affiliates
   PAST
            PERFORMANCE IS NOT NECESSARILY
            INDICATIVE OF FUTURE RESULTS
  Experience
            in Raising and Investing
            in Funds through
            December 31, 2007
  Dollar
                      Amount Offered:
                  $
                  550,000,000Dollar
                      Amount Raised:
                  $
                  20,127,316Organizational
                      Expenses*:SEC
                      registration fee**:
                  $
                  16,885FINRA registration fees**:
                  $
                  75,500AMEX
                      Listing fee**:
                  $
                  5,000Auditor's
                      fees and expenses**:
                  $
                  10,700Legal
                      fees and expenses**:
                  $
                  233,799Printing
                      expenses:
                  $
                  23,755Length
                      of Offering:
                  
                  Continuous
 ——————
 *  
            Amounts are for organizational and offering expenses incurred in connection
            with
            the initial public offering on December 6, 2007.
 ** Paid
            for
            by the General Partner in connection with the initial public
            offering.
  Performance
              Capsule
  Name
                        of Commodity Pool:
                    
                    US12OFType
                        of Commodity Pool:
                    
                    Exchange
                        traded securityInception
                        of Trading:
                    
                    December
                        6, 2007Aggregate
                        Gross Capital Subscriptions (from inception through
                        December 31, 2007):
                    
                    $
                    20,126,316Total
                        Net Assets as of December 31, 2007:
                    
                    $
                    21,691,479
                    *Initial
                        NAV Per Unit as of Inception:
                    
                    $
                    50.00NAV
                        per Unit as of December 31, 2007:
                    
                    $
                    54.23Worst
                        Monthly Percentage Draw-down:
                    
                    
                    N/AWorst
                        Peak-to-Valley Draw-down:
                    
                    
                    N/ATotal
                        Rate of Return Since Inception:
                    
                    
                    8.46
                    %
 ——————
 * Inclusive
              of transactions recorded on a trade date + 1 basis.
  PAST
              PERFORMANCE IS NOT NECESSARILY
              INDICATIVE OF FUTURE RESULTS
 
 Month
                    
                    Rates of Return
                      For the Year 2007December
                    
                    
                    8.46
                    %
 21
 
 The
                General Partner is also currently the general partner of USOF, USNG
                and USG.
                Each of the General Partner, USNG, USOF and USG is located in
                California.
 
 USOF
                is a
                publicly traded limited partnership which seeks to have the changes
                in
                percentage terms of its units' NAV track the changes in the spot
                price of light,
                sweet crude oil delivered to Cushing, Oklahoma, as measured by the changes
                in the price of the futures contract on light, sweet, crude oil traded
                on the
                NYMEX that is the near month contract to expire, except when the
                near month
                contract is within two weeks of expiration, in which case the futures
                contract
                will be the next month contract to expire, less USOF's expenses.
                USOF invests in
                a mixture of listed crude oil futures contracts, other non-listed
                oil related
                investments, Treasuries, cash and cash equivalents. USOF began trading
                on the
                AMEX on April 10, 2006 and is a continuous offering. As of December
                31, 2007,
                the total amount of money raised by USOF from Authorized Purchasers
                was
                $6,142,801,106; the total number of Authorized Purchasers was 12;
                the number of
                baskets purchased by Authorized Purchasers was 1,074; and the aggregate
                amount
                of units purchased was 107,400,000.
 
 USNG
                is a
                publicly traded limited partnership which seeks to have the changes
                in
                percentage terms of its units' NAV track the changes in percentage
                terms price of natural gas delivered at the Henry Hub, Louisiana, as
                measured by the changes in th eprice of the futures contract on natural
                gas
                traded on the NYMEX that is the near month contract to expire, except
                when the
                near month contract is within two weeks of expiration, in which case
                it will be
                measured by the futures contract that is the next month contract
                to expire, less
                USNG's expenses. USNG invests in a mixture of listed natural gas
                futures
                contracts, other natural gas related investments, Treasuries, cash
                and cash
                equivalents. USNG began trading on the AMEX on April 18, 2007 and
                is a
                continuous offering.  As of December 31, 2007, the total amount of
                money raised by USNG from Authorized Purchasers was $1,458,787,976;
                the total
                number of Authorized Purchasers was 4; the number of baskets purchased
                by
                Authorized Purchasers was 379; and the aggregate amount of units
                purchased was
                37,900,000.
  USG
                  is a
                  publicly traded limited partnership which seeks to have the changes
                  in
                  percentage terms of its units’ NAV track the changes in percentage terms of the
                  price of unleaded gasoline delivered to the New York harbor, as
                  measured by the
                  changes in the price of the futures contract on gasoline traded
                  on the NYMEX,
                  less USG’s expenses.  USG invests in a mixture of listed gasoline
                  futures contracts, other gasoline related investments, Treasuries,
                  cash and cash
                  equivalents.  USG began trading on the AMEX on February 26, 2008 and
                  is a continuous offering.  During the year ended December 31, 2007,
                  USG had not yet commenced investment activities nor issued
                  units.
 
 Since
                the
                offering of USOF units to the public on April 10, 2006 to December
                31, 2007, the
                simple average daily change in the Benchmark Oil Futures Contract
                was -0.031%,
                while the simple average daily change in the NAV of USOF over the
                same time
                period was 0.042%. The average daily difference was 0.011% (or 1.1
                basis point,
                where 1 basis point equals 1/100 of 1%). As a percentage of the daily
                movement
                of the Benchmark Oil Futures Contract, the average error in daily
                tracking by
                the NAV was 2.98%, meaning that over this time period USOF’s tracking error was
                within the plus or minus 10% range established as its benchmark tracking
                goal.
 
 Since
                the
                offering of USNG units to the public on April 18, 2007 to December
                31, 2007, the
                simple average daily change in the Benchmark Futures Contract was
                -0.154%, while
                the simple average daily change in the NAV of USNG over the same
                time period was
                -0.143%. The average daily difference was 0.012% (or 1.2 basis points,
                where 1
                basis point equals 1/100 of 1%). As a percentage of the daily movement
                of the
                Benchmark Futures Contract, the average error in daily tracking by
                the NAV was
                1.994%, meaning that over this time period USNG’s tracking error was within the
                plus or minus 10% range established as its benchmark tracking goal.
 
 There
                are
                significant differences between investing in USOF and USNG and investing
                directly in the futures market. The General Partner’s results with USOF and USNG
                may not be representative of results that may be experienced with
                a fund
                directly investing in futures contracts or other managed funds investing
                in
                futures contracts. For more information on the performance of USOF
                and USNG, see
                the Performance Tables below.  Since
                USG
                did not commence investment activities nor issue units during the
                year ended
                December 31, 2007, performance information has not been included
                for
                USG.
 
 PAST
                PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
 Experience
                in Raising and Investing in Funds through December 31, 2007
 
 Dollar
                          Amount Offered in USOF Offering*:
                      
                      $
                      7,094,860,000Dollar
                          Amount Raised in USOF Offering:
                      
                      $
                      6,142,801,105Organizational
                          Expenses in USOF Offering:SEC
                          registration fee**:
                      
                      $
                      800,474FINRA
                          registration fee**:
                      
                      $
                      377,500AMEX
                          listing fee**:
                      
                      $
                      5,000Auditor’s
                          fees and expenses**:
                      
                      $
                      59,000Legal
                          fees and expenses**:
                      
                      $
                      1,249,109Printing
                          expenses**:
                      
                      $
                      241,977Length
                          of USOF offering:
                      
                      Continuous
 
 *
                      Reflects
                          the offering price per unit set forth on the cover page
                          of the
                          registration statement registering such units filed with
                          the SEC.
 **
                      Through
                          December 31, 2006, these expenses were paid for by an affiliate
                          of the
                          General Partner in connection with the initial public offering.
                          Following
                          December 31, 2006, USOF has recorded these expenses.
 
 Dollar
                          Amount Offered in USNG Offering*:
                      
                      $
                      3,664,500,000Dollar
                          Amount Raised in USNG Offering:
                      
                      $
                      1,458,787,976Organizational
                          Expenses in USNG Offering:SEC
                          registration fee**:
                      
                      $
                      104,010FINRA
                          registration fee**:
                      
                      $
                      151,000AMEX
                          listing fee**:
                      
                      $
                      5,000Auditor’s
                          fees and expenses**:
                      
                      $
                      29,000Legal
                          fees and expenses**:
                      
                      $
                      526,746Printing
                          expenses**:
                      
                      $
                      40,323Length
                          of USNG offering:
                      
                      Continuous
 
 *
                      Reflects
                          the offering price per unit set forth on the cover page
                          of the
                          registration statement registering such units filed with
                          the SEC.
 **
                      These
                          expenses were paid for by the General Partner and USNG.
 22
 Compensation
            to the General Partner and Other Compensation
 
 USOF:
 Expenses
            Paid by USOF through
            December 31, 2007 in dollar terms (unaudited):
 
 Expense
                  
                  Amount
                      inDollar
                      TermsAmount
                      Paid to General Partner in USOF Offering:
                  
                  $
                  3,622,613Amount
                      Paid in Portfolio Brokerage Commissions in USOF offering:
                  
                  $
                  1,184,956Other
                      Amounts Paid in USOF Offering:
                  
                  $
                  1,530,281Total
                      Expenses Paid in USOF Offering:
                  
                  $
                  6,337,850
 
 Expenses
            Paid by USOF through
            December 31, 2007 as a Percentage of Average Daily Net Assets
            (unaudited):
 
 Expenses
                      in USOF Offering:
                  Amount
                      As a Percentage ofAverage
                      Daily Net AssetsGeneral
                      Partner:
                  0.50%
                      annualizedPortfolio
                      Brokerage Commissions:
                  0.16%
                      annualizedOther
                      Amounts Paid in USOF Offering
                  0.21%
                      annualizedTotal
                      Expense Ratio:
                  0.87%
                      annualizedUSOF
                      Performance:Name
                      of Commodity Pool:
                  USOFType
                      of Commodity Pool:
                  Exchange
                      traded securityInception
                      of Trading:
                  April
                      10, 2006Aggregate
                      Gross Capital Subscriptions (from inception through December
                      31,
                      2007):
                  $6,142,801,105Total
                      Net Assets as of December 31, 2007:
                  $485,222,737Initial
                      NAV Per Unit as of Inception:
                  $67.39NAV
                      per Unit as of December 31, 2007:
                  $75.82Worst
                      Monthly Percentage Draw-down:
                  September
                      2006 (11.71%)Worst
                      Peak-to-Valley Draw-down:
                  June
                      2006 - January 2007 (30.60%)
 
 USNG:
 Expenses
            Paid by USNG through
            December 31, 2007 in dollar terms (unaudited):
 
 Expense
                  
                  Amount
                      inDollar
                      TermsAmount
                      Paid to General Partner in USNG Offering:
                  
                  $
                  1,239,862Amount
                      Paid in Portfolio Brokerage Commissions in USNG offering:
                  
                  $
                  351,310Other
                      Amounts Paid in USNG Offering:
                  
                  $
                  454,149Total
                      Expenses Paid in USNG Offering:
                  
                  $
                  2,045,321
 
 Expenses
            Paid by USNG through
            December31, 2007 as a Percentage of Average Daily Net Assets
            (unaudited):
 
 Expenses
                      in USNG Offering:
                  Amount
                      As a Percentage ofAverage
                      Daily Net AssetsGeneral
                      Partner:
                  0.60%
                      annualizedPortfolio
                      Brokerage Commissions:
                  0.17%
                      annualizedOther
                      Amounts Paid in USNG Offering
                  0.22%
                      annualizedTotal
                      Expense Ratio:
                  0.99%
                      annualizedUSNG
                      Performance:Name
                      of Commodity Pool:
                  USNGType
                      of Commodity Pool:
                  Exchange
                      traded securityInception
                      of Trading:
                  April
                      18, 2007Aggregate
                      Gross Capital Subscriptions (from inception through December
                      31,
                      2007):
                  $1,458,786,977Total
                      Net Assets as of December 31, 2007:
                  $593,394,981Initial
                      NAV Per Unit as of Inception:
                  $50.00NAV
                      per Unit as of December 31, 2007:
                  $36.18Worst
                      Monthly Percentage Draw-down:
                  November
                      2007 (16.16%)Worst
                      Peak-to-Valley Draw-down:
                  April
                      2007 - August 2007 (34.74%)
  COMPOSITE
              PERFORMANCE DATA FOR USOF
 PAST
              PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
 
 Month
                    
                    Rates
                        of ReturnFor
                        the Year 2006April*
                    
                    
                    3.47
                    %May
                    
                    
                    (2.91
                    %)June
                    
                    
                    3.16
                    %July
                    
                    
                    (0.50
                    %)August
                    
                    
                    (6.97
                    %)September
                    
                    
                    (11.71
                    %)October
                    
                    
                    (8.46
                    %)November
                    
                    
                    4.73
                    %December
                    
                    
                    (5.21
                    %)Annual
                        Rate of Return (since inception through December 31, 2006)
                    
                    
                    (23.03
                    %)
 *
              Partial from April 10,
              2006.
 23
 Month
                    
                    Rates
                        of ReturnFor
                        the Year 2007January
                    
                    
                    (6.55
                    )%February
                    
                    
                    5.63
                    %March
                    
                    
                    4.61
                    %April
                    
                    
                    (4.26
                    )%May
                    
                    
                    (4.91
                    )%June
                    
                    
                    9.06
                    %July
                    
                    
                    10.57
                    %August
                    
                    
                    (4.95
                    )%September
                    
                    
                    12.11
                    %October
                    
                    
                    16.98
                    %November
                    
                    
                    (4.82
                    )%December
                    
                    
                    8.67
                    %Annual
                        Rate of Return (through December 31, 2007)
                    
                    
                    46.17
                    %
 
 COMPOSITE
              PERFORMANCE DATA FOR USNG
 PAST
              PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
 Month
                    
                    Rates
                        of ReturnFor
                        the Year 2007April*
                    
                    
                    4.30
                    %May
                    
                    
                    (0.84
                    )%June
                    
                    
                    (15.90
                    )%July
                    
                    
                    (9.68
                    )%August
                    
                    
                    (13.37
                    )%September
                    
                    
                    12.28
                    %October
                    
                    
                    12.09
                    %November
                    
                    
                    (16.16
                    )%December
                    
                    
                    0.75
                    %Annual
                        Rate of Return (through December 31, 2007)
                    
                    
                    (27.64
                    )%
 *
              Partial
              from April 17, 2007.
 
 Draw-down:
              Losses experienced over a specified period. Draw-down is measured on
              the basis
              of monthly returns only and does not reflect intra-month figures.
 
 Worst
              Monthly Percentage Draw-down: The largest single month loss sustained
              since
              inception of trading.
 
 Worst
              Peak-to-Valley Draw-down: The largest percentage decline in the NAV
              per unit
              over the history of the fund. This need not be a continuous decline,
              but can be
              a series of positive and negative returns where the negative returns
              are larger
              than the positive returns.  Worst Peak-to-Valley Draw-down represents
              the greatest percentage decline from any month-end NAV per unit that
              occurs
              without such month-end NAV per unit being equaled or exceeded as of
              a subsequent
              month-end. For example, if the NAV per unit declined by $1 in each
              of January
              and February, increased by $1 in March and declined again by $2 in
              April, a
“peak-to-trough drawdown” analysis conducted as of the end of April would
              consider that “drawdown” to be still continuing and to be $3 in amount, whereas
              if the NAV per unit had increased by $2 in March, the January-February
              drawdown
              would have ended as of the end of February at the $2 level.
 
 Nicholas
              Gerber, the president and CEO of the General Partner, ran the Marc
              Stevens
              Futures Index Fund over 10 years ago. This fund combined commodity
              futures with
              equity stock index futures. It was a very small private offering, which
              had
              under $1 million in assets. The Marc Stevens Futures Index Fund was
              a commodity
              pool and Mr. Gerber was the CPO. Ameristock Corporation is an affiliate
              of the
              General Partner and it is a California-based registered investment
              advisor
              registered under the Investment Advisers Act of 1940, as amended (the
              "Advisers
              Act") that has been sponsoring and providing portfolio management services
              to
              mutual funds since 1995. Ameristock Corporation is the investment adviser
              to the
              Ameristock Mutual Fund, Inc., a mutual fund registered under the Investment
              Company Act of 1940, as amended (the "1940 Act") that focuses on large
              cap U.S.
              equities that has approximately $425 million in assets as of December
              31, 2007.
Ameristock
              Corporation is also the investment advisor to the Ameristock ETF Trust,
              an
              open-end management investment company registered under the 1940 Act
              that seeks
              investment results that correspond to the performance of U.S. Treasury
              indices
              owned and compiled by Ryan Holdings LLC and Ryan ALM,
              Inc.
 Investments
  The
            General Partner applies substantially all of US12OF’s assets toward trading
            in Futures Contracts and Other Crude Oil Related Investments, Treasuries,
            cash and/or cash equivalents. The General Partner has sole authority
            to
            determine the percentage of assets that are:
  ·
                  held
                      on deposit with the futures commission merchant or other
                      custodian,
 ·
                    used
                        for other investments, and
 ·
                  held
                      in bank accounts to pay current obligations and as
                      reserves.
  The
            General Partner deposits substantially all of US12OF’s net assets with the
            Custodian or other custodian for trading. When US12OF purchases a Futures
            Contract and certain exchange traded Other Crude Oil Related Investments,
            US12OF
            is also required to deposit with the futures commission merchant on behalf
            of
            the exchange a portion of the value of the contract or other interest
            as
            security to ensure payment for the obligation under crude oil interests
            at
            maturity. This deposit is known as “margin.” US12OF invests the remainder of its
            assets equal to the difference between the margin deposited and the face
            value
            of the Futures Contract in Treasuries, cash and/or cash
            equivalents.
  The
            General Partner believes that all entities that hold or trade US12OF’s assets
            are based in the United States and are subject to United States
            regulations.
  Approximately
            5% to 10% of US12OF’s assets have normally been committed as margin
            for Futures Contracts. However, from time to time, the percentage of assets
            committed as margin may be substantially more, or less, than such range.
            The
            General Partner invests the balance of US12OF’s assets not invested in Crude Oil
            Interests or held in margin as reserves to be available for changes in
            margin.
            All interest income is used for US12OF’s benefit.
  The
            futures commission merchant, a government agency or a commodity exchange
            could
            increase margins applicable to US12OF to hold trading positions at any
            time.
            Moreover, margin is merely a security deposit and has no bearing on the
            profit
            or loss potential for any positions taken.
  US12OF’s
            assets are held in segregation pursuant to the CEA and CFTC
            regulations.
 24
 The
            Commodity Interest
            Markets
  General
  The CEA
            governs the regulation of commodity interest transactions, markets and
            intermediaries. In December 2000, the CEA was amended by the Commodity
            Futures
            Modernization Act of 2000 (the "CFMA"), which substantially revised the
            regulatory framework governing certain commodity interest transactions
            and the
            markets on which they trade. The CEA, as amended by the CFMA, now provides
            for
            varying degrees of regulation of commodity interest transactions depending
            upon
            the variables of the transaction. In general, these variables include
            (1) the
            type of instrument being traded (e.g., contracts for future delivery,
            options,
            swaps or spot contracts), (2) the type of commodity underlying the instrument
            (distinctions are made between instruments based on agricultural commodities,
            energy and metals commodities and financial commodities), (3) the nature
            of the
            parties to the transaction (retail, eligible contract participant, or
            eligible
            commercial entity), (4) whether the transaction is entered into on a
            principal-to-principal or intermediated basis, (5) the type of market
            on which
            the transaction occurs, and (6) whether the transaction is subject to
            clearing
            through a clearing organization. Information regarding commodity interest
            transactions, markets and intermediaries, and their associated regulatory
            environment, is provided below.
  Futures
            Contracts
  A
            futures
            contract such as a Futures Contract is a standardized contract traded
            on, or
            subject to the rules of, an exchange that calls for the future delivery
            of a
            specified quantity and type of a commodity at a specified time and place.
            Futures contracts are traded on a wide variety of commodities, including
            agricultural products, bonds, stock indices, interest rates, currencies,
            energy
            and metals. The size and terms of futures contracts on a particular commodity
            are identical and are not subject to any negotiation, other than with
            respect to
            price and the number of contracts traded between the buyer and
            seller.
  The
            contractual obligations of a buyer or seller may generally be satisfied
            by
            taking or making physical delivery of the underlying of commodity or
            by making
            an offsetting sale or purchase of an identical futures contract on the
            same or
            linked exchange before the designated date of delivery. The difference
            between
            the price at which the futures contract is purchased or sold and the
            price paid
            for the offsetting sale or purchase, after allowance for brokerage commissions,
            constitutes the profit or loss to the trader. Some futures contracts,
            such as
            stock index contracts, settle in cash (reflecting the difference between
            the
            contract purchase/sale price and the contract settlement price) rather
            than by
            delivery of the underlying commodity.
  In
            market
            terminology, a trader who purchases a futures contract is long in the
            market and
            a trader who sells a futures contract is short in the market. Before
            a trader
            closes out his long or short position by an offsetting sale or purchase,
            his
            outstanding contracts are known as open trades or open positions. The
            aggregate
            amount of open positions held by traders in a particular contract is
            referred to
            as the open interest in such contract.
  Forward
            Contracts
  A
            forward
            contract is a contractual obligation to purchase or sell a specified
            quantity of
            a commodity at or before a specified date in the future at a specified
            price
            and, therefore, is economically similar to a futures contract. Unlike
            futures
            contracts, however, forward contracts are typically traded in the
            over-the-counter markets and are not standardized contracts. Forward
            contracts
            for a given commodity are generally available for various amounts and
            maturities
            and are subject to individual negotiation between the parties involved.
            Moreover, generally there is no direct means of offsetting or closing
            out a
            forward contract by taking an offsetting position as one would a futures
            contract on a U.S. exchange. If a trader desires to close out a forward
            contract
            position, he generally will establish an opposite position in the contract
            but
            will settle and recognize the profit or loss on both positions simultaneously
            on
            the delivery date. Thus, unlike in the futures contract market where
            a trader
            who has offset positions will recognize profit or loss immediately, in
            the
            forward market a trader with a position that has been offset at a profit
            will
            generally not receive such profit until the delivery date, and likewise
            a trader
            with a position that has been offset at a loss will generally not have
            to pay
            money until the delivery date. In recent years, however, the terms of
            forward
            contracts have become more standardized, and in some instances such contracts
            now provide a right of offset or cash settlement as an alternative to
            making or
            taking delivery of the underlying commodity.
 25
 The
              forward markets provide what has typically been a highly liquid market
              for
              foreign exchange trading, and in certain cases the prices quoted for
              foreign
              exchange forward contracts may be more favorable than the prices for
              foreign
              exchange futures contracts traded on U.S. exchanges. The forward markets
              are
              largely unregulated. Forward contracts are, in general, not cleared
              or
              guaranteed by a third party. Commercial banks participating in trading
              foreign
              exchange forward contracts often do not require margin deposits, but
              rely upon
              internal credit limitations and their judgments regarding the creditworthiness
              of their counterparties. In recent years, however, many over-the-counter
              market
              participants in foreign exchange trading have begun to require that
              their
              counterparties post margin.
  Further,
            as the result of the CFMA, over-the-counter derivative instruments such
            as
            forward contracts and swap agreements (and options on forwards and physical
            commodities) may begin to be traded on lightly-regulated exchanges or
            electronic
            trading platforms that may, but are not required to, provide for clearing
            facilities. Exchanges and electronic trading platforms on which over-the-counter
            instruments may be traded and the regulation and criteria for that trading
            are
            more fully described below under “Futures Exchanges and Clearing Organizations.”
Nonetheless, absent a clearing facility, US12OF’s trading in foreign exchange
            and other forward contracts is exposed to the creditworthiness of the
            counterparties on the other side of the trade.
  Options
            on Futures
            Contracts
  Options
            on futures contracts are standardized contracts traded on an exchange.
            An option
            on a futures contract gives the buyer of the option the right, but not
            the
            obligation, to take a position at a specified price (the striking, strike,
            or
            exercise price) in the underlying futures contract or underlying interest.
            The
            buyer of a call option acquires the right, but not the obligation, to
            purchase
            or take a long position in the underlying interest, and the buyer of
            a put
            option acquires the right, but not the obligation, to sell or take a
            short
            position in the underlying interest.
  The
            seller, or writer, of an option is obligated to take a position in the
            underlying interest at a specified price opposite to the option buyer
            if the
            option is exercised. Thus, the seller of a call option must stand ready
            to take
            a short position in the underlying interest at the strike price if the
            buyer
            should exercise the option. The seller of a put option, on the other
            hand, must
            stand ready to take a long position in the underlying interest at the
            strike
            price.
  A
            call
            option is said to be in-the-money if the strike price is below current
            market
            levels and out-of-the-money if the strike price is above current market
            levels.
            Conversely, a put option is said to be in-the-money if the strike price
            is above
            the current market levels and out-of-the-money if the strike price is
            below
            current market levels.
  Options
            have limited life spans, usually tied to the delivery or settlement date
            of the
            underlying interest. Some options, however, expire significantly in advance
            of
            such date. The purchase price of an option is referred to as its premium,
            which
            consists of its intrinsic value (which is related to the underlying market
            value) plus its time value. As an option nears its expiration date, the
            time
            value shrinks and the market and intrinsic values move into parity. An
            option
            that is out-of-the-money and not offset by the time it expires becomes
            worthless. On certain exchanges, in-the-money options are automatically
            exercised on their expiration date, but on others unexercised options
            simply
            become worthless after their expiration date.
  Regardless
            of how much the market swings, the most an option buyer can lose is the
            option
            premium. The option buyer deposits his premium with his broker, and the
            money
            goes to the option seller. Option sellers, on the other hand, face risks
            similar
            to participants in the futures markets. For example, since the seller
            of a call
            option is assigned a short futures position if the option is exercised,
            his risk
            is the same as someone who initially sold a futures contract. Because
            no one can
            predict exactly how the market will move, the option seller posts margin
            to
            demonstrate his ability to meet any potential contractual
            obligations.
 26
 Options
            on Forward Contracts or
            Commodities
  Options
              on forward contracts or commodities operate in a manner similar to
              options on
              futures contracts. An option on a forward contract or commodity gives
              the buyer
              of the option the right, but not the obligation, to take a position
              at a
              specified price in the underlying forward contract or commodity. However,
              similar to forward contracts, options on forward contracts or on commodities
              are
              individually negotiated contracts between counterparties and are typically
              traded in the over-the-counter market. Therefore, options on forward
              contracts
              and physical commodities possess many of the same characteristics of
              forward
              contracts with respect to offsetting positions and credit risk that
              are
              described above.
  Swap
              Contracts
  Swap
              transactions generally involve contracts between two parties to exchange
              a
              stream of payments computed by reference to a notional amount and the
              price of
              the asset that is the subject of the swap. Swap contracts are principally
              traded
              off-exchange, although recently, as a result of regulatory changes
              enacted as
              part of the CFMA, certain swap contracts are now being traded in electronic
              trading facilities and cleared through clearing organizations.
  Swaps
              are
              usually entered into on a net basis, that is, the two payment streams
              are netted
              out in a cash settlement on the payment date or dates specified in
              the
              agreement, with the parties receiving or paying, as the case may be,
              only the
              net amount of the two payments. Swaps do not generally involve the
              delivery of
              underlying assets or principal. Accordingly, the risk of loss with
              respect to
              swaps is generally limited to the net amount of payments that the party
              is
              contractually obligated to make. In some swap transactions one or both
              parties
              may require collateral deposits from the counterparty to support that
              counterparty’s obligation under the swap agreement. If the counterparty to such
              a swap defaults, the risk of loss consists of the net amount of payments
              that
              the party is contractually entitled to receive less any collateral deposits
              it is holding.
 Block
                Trading
  Block
                Trading refers to privately negotiated futures or option transactions
                executed
                apart from the public auction market. A block transaction may be
                executed either
                on or off the exchange trading floor but is still reported to and
                cleared by the
                exchange.
  Exchange
                for Physical
  A
                technique (originated in physical commodity markets) whereby a position
                in the
                underlying subject of a derivatives contract is traded for a futures
                position.
                In financial futures markets, the EFP bypasses any cash settlement
                mechanism
                that is built into the contract and substitutes physical settlement.
                EFPs are
                used primarily to adjust underlying cash market positions at a low
                trading cost.
                An EFP by itself will not change either party’s net risk position materially,
                but EFPs are often used to set up a subsequent trade which will modify
                the
                investor’s market risk exposure at low cost.
  Exchange
                for Swap
  An
                Exchange For Swap (“EFS”) is an off market transaction which involves the
                swapping (or exchanging) of an over-the-counter (OTC) position for
                a futures
                position. The OTC transaction must be for the same or similar quantity
                or amount
                of a specified commodity, or a substantially similar commodity or
                instrument.
                The OTC side of the EFS can include swaps, swap options, or other
                instruments
                traded in the OTC market.
  In
                order
                that an EFS transaction can take place, the OTC side and futures
                components must
                be “substantially similar” in terms of either value and or quantity. The net
                result is that the OTC position (and the inherent counterparty credit
                exposure)
                is transferred from the OTC market to the futures market. EFSs can
                also work in
                reverse, where a futures position can be reversed and transferred
                to the OTC
                market.
  Participants
  The
              two
              broad classes of persons who trade commodities are hedgors and speculators.
              Hedgors include financial institutions that manage or deal in interest
              rate-sensitive instruments, foreign currencies or stock portfolios,
              and
              commercial market participants, such as farmers and manufacturers,
              that market
              or process commodities. Hedging is a protective procedure designed
              to lock in
              profits that could otherwise be lost due to an adverse movement in
              the
              underlying commodity, for example, the adverse price movement between
              the time a
              merchandiser or processor enters into a contract to buy or sell a raw
              or
              processed commodity at a certain price and the time he must perform
              the
              contract. In such a case, at the time the hedgor contracts to physically
              sell
              the commodity at a future date he will simultaneously buy a futures
              or forward
              contract for the necessary equivalent quantity of the commodity. At
              the time for
              performance of the contract, the hedgor may accept delivery under his
              futures
              contract and sell the commodity quantity as required by his physical
              contract or
              he may buy the actual commodity, sell if under the physical contract
              and close
              out his position by making an offsetting sale of a futures
              contract.
  The
              commodity interest markets enable the hedgor to shift the risk of price
              fluctuations. The usual objective of the hedgor is to protect the profit
              that he
              expects to earn from farming, merchandising, or processing operations
              rather
              than to profit from his trading. However, at times the impetus for
              a hedge
              transaction may result in part from speculative objectives.
  Unlike
              the hedgor, the speculator generally expects neither to make nor take
              delivery
              of the underlying commodity. Instead, the speculator risks his capital
              with the
              hope of making profits from price fluctuations in the commodities.
              The
              speculator is, in effect, the risk bearer who assumes the risks that
              the hedgor
              seeks to avoid. Speculators rarely make or take delivery of the underlying
              commodity; rather they attempt to close out their positions prior to
              the
              delivery date. Because the speculator may take either a long or short
              position
              in commodities, it is possible for him to make profits or incur losses
              regardless of whether prices go up or down.
 27
 Futures
              Exchanges and Clearing
              Organizations
  Futures
              exchanges provide centralized market facilities in which multiple persons
              have
              the ability to execute or trade contracts by accepting bids and offers
              from
              multiple participants. Futures exchanges may provide for execution
              of trades at
              a physical location utilizing trading pits and/or may provide for trading
              to be
              done electronically through computerized matching of bids and offers
              pursuant to
              various algorithms. Members of a particular exchange and the trades
              executed on
              such exchange are subject to the rules of that exchange. Futures exchanges
              and
              clearing organizations are given reasonable latitude in promulgating
              rules and
              regulations to control and regulate their members. Examples of regulations
              by
              exchanges and clearing organizations include the establishment of initial
              margin
              levels, rules regarding trading practices, contract specifications,
              speculative
              position limits, daily price fluctuation limits, and execution and
              clearing
              fees.
  Clearing
              organizations provide services designed to mutualize or transfer the
              credit risk
              arising from the trading of contracts on an exchange or other electronic
              trading
              facility. Once trades made between members of an exchange or electronic
              trading
              facility have been confirmed, the clearing organization becomes substituted
              for
              the clearing member acting on behalf of each buyer and each seller
              of contracts
              traded on the exchange or trading platform and in effect becomes the
              other party
              to the trade. Thereafter, each clearing member party to the trade looks
              only to
              the clearing
              organization for performance. The clearing organization generally establishes
              some sort of security or guarantee fund to which all clearing members
              of the
              exchange must contribute; this fund acts as an emergency buffer that
              is intended
              to enable the clearing organization to meet its obligations with regard
              to the
              other side of an insolvent clearing member’s contracts. Furthermore, the
              clearing organization requires margin deposits and continuously marks
              positions
              to market to provide some assurance that its members will be able to
              fulfill
              their contractual obligations. Thus, a central function of the clearing
              organization is to ensure the integrity of trades, and members effecting
              transactions on an exchange need not concern themselves with the solvency
              of the
              party on the opposite side of the trade; their only remaining concerns
              are the
              respective solvencies of their own customers, their clearing broker
              and the
              clearing organization. The clearing organizations do not deal with
              customers,
              but only with their member firms and the guarantee of performance for
              open
              positions provided by the clearing organization does not run to
              customers.
  U.S.
              Futures
              Exchanges
  Futures
              exchanges in the United States are subject to varying degrees of regulation
              by
              the CFTC based on their designation as one of the following: a designated
              contract market, a derivatives transaction execution facility, an exempt
              board
              of trade or an electronic trading facility.
  A
              designated contract market is the most highly regulated level of futures
              exchange. Designated contract markets may offer products to retail
              customers on
              an unrestricted basis. To be designated as a contract market, the exchange
              must
              demonstrate that it satisfies specified general criteria for designation,
              such
              as having the ability to prevent market manipulation, rules and procedures
              to
              ensure fair and equitable trading, position limits, dispute resolution
              procedures, minimization of conflicts of interest and protection of
              market
              participants. Among the principal designated contract markets in the
              United
              States are the Chicago Board of Trade, the Chicago Mercantile Exchange
              and the
              NYMEX. Each of the designated contract markets in the United States
              must provide
              for the clearance and settlement of transactions with a CFTC-registered
              derivatives clearing organization.
 28
 A
              derivatives transaction execution facility (a "DTEF"), is a new type
              of exchange
              that is subject to fewer regulatory requirements than a designated
              contract
              market but is subject to both commodity interest and participant limitations.
              DTEFs limit access to eligible traders that qualify as either eligible
              contract
              participants or eligible commercial entities for futures and option
              contracts on
              commodities that have a nearly inexhaustible deliverable supply, are
              highly
              unlikely to be susceptible to the threat of manipulation, or have no
              cash
              market, security futures products, and futures and option contracts
              on
              commodities that the CFTC may determine, on a case-by-case basis, are
              highly
              unlikely to be susceptible to the threat of manipulation. In addition,
              certain
              commodity interests excluded or exempt from the CEA, such as swaps,
              etc. may be
              traded on a DTEF. There is no requirement that a DTEF use a clearing
              organization, except with respect to trading in security futures contracts,
              in
              which case the clearing organization must be a securities clearing
              agency.
              However, if futures contracts and options on futures contracts on a
              DTEF are
              cleared, then it must be through a CFTC-registered derivatives clearing
              organization, except that some excluded or exempt commodities traded
              on a DTEF
              may be cleared through a clearing organization other than one registered
              with
              the CFTC.
  An
              exempt
              board of trade is also a newly designated form of exchange. An exempt
              board of
              trade is substantially unregulated, subject only to CFTC anti-fraud
              and
              anti-manipulation authority. An exempt board of trade is permitted
              to trade
              futures contracts and options on futures contracts provided that the
              underlying
              commodity is not a security or securities index and has an inexhaustible
              deliverable supply or no cash market. All traders on an exempt board
              of trade
              must qualify as eligible contract participants. Contracts deemed eligible
              to be
              traded on an exempt board of trade include contracts on interest rates,
              exchange
              rates, currencies, credit risks or measures, debt instruments, measures
              of
              inflation, or other macroeconomic indices or measures. There is no
              requirement
              that an exempt board of trade use a clearing organization. However,
              if contracts
              on an exempt board of trade are cleared, then it must be through a
              CFTC-registered derivatives clearing organization. A board of trade
              electing to
              operate as an exempt board of trade must file a written notification
              with the
              CFTC.
  An
              electronic trading facility is a new form of exchange that operates
              by means of
              an electronic or telecommunications network and maintains an automated
              audit
              trail of bids, offers, and the matching of orders or the execution
              of
              transactions on the electronic trading facility. The CEA does not apply
              to, and
              the CFTC has no jurisdiction over, transactions on an electronic trading
              facility in certain excluded commodities that are entered into between
              principals that qualify as eligible contract participants, subject
              only to CFTC
              anti-fraud and anti- manipulation
              authority. In general, excluded commodities include interest rates,
              currencies,
              securities, securities indices or other financial, economic or commercial
              indices or measures.
  The
              General Partner intends to monitor the development of and opportunities
              and
              risks presented by the new less-regulated exchanges and exempt boards
              and may,
              in the future, allocate a percentage of US12OF’s assets to trading in products
              on these exchanges. Provided US12OF maintains assets exceeding $5 million,
              US12OF would qualify as an eligible contract participant and thus would
              be able
              to trade on such exchanges.
  Non-U.S.
              Futures
              Exchanges
  Non-U.S.
              futures exchanges differ in certain respects from their U.S. counterparts.
              Importantly, non-U.S. futures exchanges are not subject to regulation
              by the
              CFTC, but rather are regulated by their home country regulator. In
              contrast to
              U.S. designated contract markets, some non-U.S. exchanges are principals’
markets, where trades remain the liability of the traders involved,
              and the
              exchange or an affiliated clearing organization, if any, does not become
              substituted for any party. Due to the absence of a clearing system,
              such
              exchanges are significantly more susceptible to disruptions. Further,
              participants in such markets must often satisfy themselves as to the
              individual
              creditworthiness of each entity with which they enter into a trade.
              Trading on
              non-U.S. exchanges is often in the currency of the exchange’s home jurisdiction.
              Consequently, US12OF is subject to the additional risk of fluctuations
              in the
              exchange rate between such currencies and U.S. dollars and the possibility
              that
              exchange controls could be imposed in the future. Trading on non-U.S.
              exchanges
              may differ from trading on U.S. exchanges in a variety of ways and,
              accordingly,
              may subject US12OF to additional risks.
 29
 Accountability
              Levels
              and Position Limits
  The
              CFTC
              and U.S. designated contract markets have established accountability
              levels and
              position limits on the maximum net long or net short futures contracts in
              commodity interests that any person or group of persons under common
              trading control (other than a hedgor, which US12OF is not) may hold,
              own or
              control. Among the purposes of accountability levels and position limits
              is to
              prevent a corner or squeeze on a market or undue influence on prices
              by any
              single trader or group of traders. The position limits currently established
              by
              the CFTC apply to certain agricultural commodity interests, such as
              grains
              (oats, barley, and flaxseed), soybeans, corn, wheat, cotton, eggs,
              rye, and
              potatoes, but not to interests in energy products. In addition, U.S.
              exchanges
              may set accountability levels and position limits for all commodity
              interests
              traded on that exchange. For example, the current accountability level
              for
              investments at any one time in crude oil Futures Contracts (including
              investments in the Benchmark Futures Contract) on the NYMEX is 20,000
              contracts. The NYMEX also imposes position limits on contracts held
              in the last
              few days of trading in the near month contract to expire. Certain exchanges
              or
              clearing organizations also set limits on the total net positions that
              may be
              held by a clearing broker. In general, no position limits are in effect
              in
              forward or other over-the-counter contract trading or in trading on
              non-U.S.
              futures exchanges, although the principals with which US12OF and the
              clearing
              brokers may trade in such markets may impose such limits as a matter
              of credit
              policy. For purposes of determining accountability levels and position
              limits
              US12OF’s commodity interest positions will not be attributable to investors
              in
              their own commodity interest trading.
  Daily
              Price
              Limits
  Most
              U.S.
              futures exchanges (but generally not non-U.S. exchanges) limit the amount
              of fluctuation in some futures contract or options on a futures contract
              prices
              during a single trading period by regulations. These regulations specify
              what
              are referred to as daily price fluctuation limits or more commonly,
              daily
              limits. The daily limits establish the maximum amount that the price
              of a
              futures or options on futures contract may vary either up or down from
              the
              previous day’s settlement price. Once the daily limit has been reached in a
              particular futures or option on a futures contract, no trades may be made
              at a price beyond the limit. Positions in the futures or options contract
              may
              then be taken or liquidated, if at all, only at inordinate expense
              or if traders
              are willing to effect trades at or within the limit during the period
              for
              trading on such day. Because the daily limit rule governs price movement
              only
              for a particular trading day, it does not limit losses and may in fact
              substantially increase losses because it may prevent the liquidation
              of
              unfavorable positions. Futures contract prices have occasionally moved
              to the daily limit for several consecutive trading days, thus preventing
              prompt liquidation of positions and subjecting the trader to substantial
              losses
              for those days. The concept of daily price limits is not relevant to
              over-the-counter contracts, including forwards and swaps, and thus
              such limits
              are not imposed by banks and others who deal in those markets.
  In
              contrast, the NYMEX does not impose daily limits but rather limits
              the amount of
              price fluctuation for Futures Contracts. For example, the NYMEX imposes
              a
              $10.00 per barrel ($10,000 per contract) price fluctuation limit for crude
              oil Futures Contracts. This limit is initially based off of the previous
              trading day’s settlement price. If any Futures Contract is traded, bid, or
              offered at the limit for five minutes, trading is halted for five minutes.
              When
              trading resumes it begins at the point where the limit was imposed
              and the limit
              is reset to be $10.00 per barrel in either direction of that point.
              If another
              halt were triggered, the market would continue to be expanded by $10.00
              per
              barrel in either direction after each successive five-minute trading
              halt. There
              is no maximum price fluctuation limit during any one trading
              session.
  Commodity
              Prices
  Commodity
              prices are volatile and, although ultimately determined by the interaction
              of
              supply and demand, are subject to many other influences, including
              the
              psychology of the marketplace and speculative assessments of future
              world and
              economic events. Political climate, interest rates, treaties, balance
              of
              payments, exchange controls and other governmental interventions as
              well as
              numerous other variables affect the commodity markets, and even with
              comparatively complete information it is impossible for any trader
              to predict
              reliably commodity prices.
 30
 Regulation
  Futures
              exchanges in the United States are subject to varying degrees of regulation
              under the CEA depending on whether such exchange is a designated contract
              market, DTEF, exempt board of trade or electronic trading facility.
              Derivatives
              clearing organizations are also subject to the CEA and CFTC regulation.
              The CFTC
              is the governmental agency charged with responsibility for regulation
              of futures
              exchanges and commodity interest trading conducted on those exchanges.
              The
              CFTC’s function is to implement the CEA’s objectives of preventing price
              manipulation and excessive speculation and promoting orderly and efficient
              commodity interest markets. In addition, the various exchanges and
              clearing
              organizations themselves exercise regulatory and supervisory authority
              over
              their member firms.
  The
              CFTC
              possesses exclusive jurisdiction to regulate the activities of CPOs
              and
              commodity trading advisors and has adopted regulations with respect
              to the
              activities of those persons and/or entities. Under the CEA, a registered
              CPO,
              such as the General Partner, is required to make annual filings with
              the CFTC
              describing its organization, capital structure, management and controlling
              persons. In addition, the CEA authorizes the CFTC to require and review
              books
              and records of, and documents prepared by, registered CPOs. Pursuant
              to this
              authority, the CFTC requires CPOs to keep accurate, current and orderly
              records
              for each pool that they operate. The CFTC may suspend the registration
              of
              a CPO (1) if the CFTC finds that the operator’s trading practices tend to
              disrupt orderly market conditions, (2) if any controlling person of
              the operator
              is subject to an order of the CFTC denying such person trading privileges
              on any
              exchange, and (3) in certain other circumstances. Suspension, restriction
              or
              termination of the General Partner’s registration as a CPO would prevent it,
              until that registration were to be reinstated, from managing US12OF,
              and might
              result in the termination of US12OF. US12OF itself is not required
              to be
              registered with the CFTC in any capacity.
  The
              CEA
              gives the CFTC similar authority with respect to the activities of
              commodity
              trading advisors. If a trading advisor’s commodity trading advisor registration
              were to be terminated, restricted or suspended, the trading advisor
              would be
              unable, until the registration were to be reinstated, to render trading
              advice
              to US12OF.
  The
              CEA
              requires all futures commission merchants, such as US12OF’s clearing brokers, to
              meet and maintain specified fitness and financial requirements, to
              segregate
              customer funds from proprietary funds and account separately for all
              customers’
funds and positions, and to maintain specified books and records open
              to
              inspection by the staff of the CFTC. The CFTC has similar authority
              over
              introducing brokers, or persons who solicit or accept orders for commodity
              interest trades but who do not accept margin deposits for the execution
              of
              trades. The CEA authorizes the CFTC to regulate trading by futures
              commission
              merchants and by their officers and directors, permits the CFTC to
              require
              action by exchanges in the event of market emergencies, and establishes
              an
              administrative procedure under which customers may institute complaints
              for
              damages arising from alleged violations of the CEA. The CEA also gives
              the
              states powers to enforce its provisions and the regulations of the
              CFTC.
  US12OF’s
              investors are afforded prescribed rights for reparations under the
              CEA.
              Investors may also be able to maintain a private right of action for
              violations
              of the CEA. The CFTC has adopted rules implementing the reparation
              provisions of
              the CEA, which provide that any person may file a complaint for a reparations
              award with the
              CFTC
              for violation of the CEA against a floor broker or a futures commission
              merchant, introducing broker, commodity trading advisor, CPO, and their
              respective associated persons.
  Pursuant
              to authority in the CEA, the NFA has been formed and registered with
              the CFTC as
              a registered futures association. At the present time, the NFA is the
              only
              self-regulatory organization for commodity interest professionals,
              other than
              futures exchanges. The CFTC has delegated to the NFA responsibility
              for the
              registration of commodity trading advisors, CPOs, futures commission
              merchants,
              introducing brokers, and their respective associated persons and floor
              brokers.
              The General Partner, each trading advisor, the selling agents and the
              clearing
              brokers are members of the NFA. As such, they are subject to NFA standards
              relating to fair trade practices, financial condition and consumer
              protection.
              US12OF itself is not required to become a member of the NFA. As the
              self-regulatory body of the commodity interest industry, the NFA promulgates
              rules governing the conduct of professionals and disciplines those
              professionals
              that do not comply with these rules. The NFA also arbitrates disputes
              between
              members and their customers and conducts registration and fitness screening
              of
              applicants for membership and audits of its existing members.
 31
 The
              regulations of the CFTC and the NFA prohibit any representation by
              a person
              registered with the CFTC or by any member of the NFA, that registration
              with the
              CFTC, or membership in the NFA, in any respect indicates that the CFTC
              or the
              NFA, as the case may be, has approved or endorsed that person or that
              person’s
              trading program or objectives. The registrations and memberships of
              the parties
              described in this summary must not be considered as constituting any
              such
              approval or endorsement. Likewise, no futures exchange has given or
              will give
              any similar approval or endorsement.
  The
              regulation of commodity interest trading in the United States and other
              countries is an evolving area of the law. The various statements made
              in this
              summary are subject to modification by legislative action and changes
              in the
              rules and regulations of the CFTC, the NFA, the futures exchanges,
              clearing
              organizations and other regulatory bodies.
  The
              function of the CFTC is to implement the objectives of the CEA of preventing
              price manipulation and other disruptions to market integrity, avoiding
              systemic
              risk, preventing fraud and promoting innovation, competition and financial
              integrity of transactions. As mentioned above, this regulation, among
              other
              things, provides that the trading of commodity interest contracts generally
              must
              be upon exchanges designated as contract markets or DTEFs and that
              all trading
              on those exchanges must be done by or through exchange members. Under
              the CFMA,
              commodity interest trading in some commodities between sophisticated
              persons may
              be traded on a trading facility not regulated by the CFTC. As a general
              matter,
              trading in spot contracts, forward contracts, options on forward contracts
              or
              commodities, or swap contracts between eligible contract participants
              is not
              within the jurisdiction of the CFTC and may therefore be effectively
              unregulated. The trading advisors may engage in those transactions
              on behalf of
              US12OF in reliance on this exclusion from regulation.
  In
              general, the CFTC does not regulate the interbank and forward foreign
              currency
              markets with respect to transactions in contracts between certain sophisticated
              counterparties such as US12OF or between certain regulated institutions
              and
              retail investors. Although U.S. banks are regulated in various ways
              by the
              Federal Reserve Board, the Comptroller of the Currency and other U.S.
              federal
              and state banking officials, banking authorities do not regulate the
              forward
              markets.
  While
              the
              U.S. government does not currently impose any restrictions on the movements
              of
              currencies, it could choose to do so. The imposition or relaxation
              of exchange
              controls in various jurisdictions could significantly affect the market
              for that
              and other jurisdictions’ currencies. Trading in the interbank market also
              exposes US12OF to a risk of default since failure of a bank with which
              US12OF
              had entered into a forward contract would likely result in a default
              and thus
              possibly substantial losses to US12OF.
  The
              CFTC
              is prohibited by statute from regulating trading on non-U.S. futures
              exchanges
              and markets. The CFTC, however, has adopted regulations relating to
              the
              marketing of non-U.S. futures contracts in the United States. These
              regulations
              permit certain contracts traded on non-U.S. exchanges to be offered
              and sold in
              the United States.
  Commodity
              Margin
  Original
              or initial margin is the minimum amount of funds that must be deposited
              by a
              commodity interest trader with the trader’s broker to initiate and maintain an
              open position in futures contracts. Maintenance margin is the amount
              (generally
              less than the original margin) to which a trader’s account may decline before he
              must deliver additional margin. A margin deposit
              is like a
              cash performance bond. It helps assure the trader’s performance of the futures
              contracts that he or she purchases or sells. Futures contracts are
              customarily
              bought and sold on initial margin that represents a very small percentage
              (ranging upward from less than 2%) of the aggregate purchase or sales
              price of
              the contract. Because of such low margin requirements, price fluctuations
              occurring in the futures markets may create profits and losses that,
              in relation
              to the amount invested, are greater than are customary in other forms
              of
              investment or speculation. As discussed below, adverse price changes
              in the
              futures contract may result in margin requirements that greatly exceed
              the
              initial margin. In addition, the amount of margin required in connection
              with a
              particular futures contract is set from time to time by the exchange
              on which
              the contract is traded and may be modified from time to time by the
              exchange
              during the term of the contract.
 32
 Brokerage
              firms, such as US12OF’s clearing brokers, carrying accounts for traders in
              commodity interest contracts may not accept lower, and generally require
              higher,
              amounts of margin as a matter of policy to further protect themselves.
              The
              clearing brokers require US12OF to make margin deposits equal to exchange
              minimum levels for all commodity interest contracts. This requirement
              may be
              altered from time to time in the clearing brokers’ discretion.
  Trading
              in the over-the-counter markets where no clearing facility is provided
              generally
              does not require margin but generally does require the extension of
              credit
              between counterparties.
  When
              a
              trader purchases an option, there is no margin requirement; however,
              the option
              premium must be paid in full. When a trader sells an option, on the
              other hand,
              he or she is required to deposit margin in an amount determined by
              the margin
              requirements established for the underlying interest and, in addition,
              an amount
              substantially equal to the current premium for the option. The margin
              requirements imposed on the selling of options, although adjusted to
              reflect the
              probability that out-of-the-money options will not be exercised, can
              in fact be
              higher than those imposed in dealing in the futures markets directly.
              Complicated margin requirements apply to spreads and conversions, which
              are
              complex trading strategies in which a trader acquires a mixture of
              options
              positions and positions in the underlying interest.
  Margin
              requirements are computed each day by a trader’s clearing broker. When the
              market value of a particular open commodity interest position changes
              to a point
              where the margin on deposit does not satisfy maintenance margin requirements,
              a
              margin call is made by the broker. If the margin call is not met within
              a
              reasonable time, the broker may close out the trader’s position. With respect to
              US12OF’s trading, US12OF (and not its investors personally) is subject to
              margin
              calls.
  Finally,
              many major U.S. exchanges have passed certain cross margining arrangements
              involving procedures pursuant to which the futures and options positions
              held in
              an account would, in the case of some accounts, be aggregated and margin
              requirements would be assessed on a portfolio basis, measuring the
              total risk of
              the combined positions.
 33
 Item 1A.
                            Risk
                                Factors.
 The
                        risk
                        factors should be read in connection with the other information
                        included in this
                        annual report on Form 10-K, including Management’s Discussion and Analysis of
                        Financial Condition and Results of Operations and US12OF’s condensed financial
                        statements and the related notes.
  Risks
                    Associated With Investing Directly or Indirectly in Crude
                    Oil
 
 Investing
                    in Crude Oil Interests subjects US12OF to the risks of the crude
                    oil industry
                    and this could result in large fluctuations in the price of US12OF’s
                    units.
 
 US12OF
                    is
                    subject to the risks and hazards of the crude oil industry because
                    it invests in
                    oil interests. The risks and hazards that are inherent in the
                    oil industry may
                    cause the price of oil to widely fluctuate. If US12OF’s units accurately track
                    the percentage changes in the Benchmark Futures Contracts or
                    the spot price of
                    light, sweet crude oil, then the price of its units may also
                    fluctuate.
 
 The
                    risks
                    of crude oil drilling and production activities include the
                    following:
 •
                          no
                              commercially productive crude oil or natural gas reservoirs
                              will be
                              found;
 •
                          crude
                              oil and natural gas drilling and production activities
                              may be shortened,
                              delayed or canceled;
 •
                          the
                              ability of an oil producer to develop, produce and
                              market reserves may be
                              limited by:
 •
                          title
                              problems,
 •
                          political
                              conflicts, including war,
 •
                          weather
                              conditions,
 •
                          compliance
                              with governmental requirements,
 •
                          refinery
                              capacity, and
 •
                          mechanical
                              difficulties or shortages or delays in the delivery
                              of drilling rigs and
                              other equipment;
 •
                          decisions
                              of the cartel of oil producing countries (e.g., OPEC),
                              to produce more or
                              less oil;
 •
                          increases
                              in oil production due to price rises may make it more
                              economical to
                              extract oil from additional sources and may later temper
                              further oil price
                              increases; and
 •
                          economic
                              activity of users, as certain economies expand, oil
                              consumption and prices
                              increase (e.g., China, India) and as economies contract
                              (in a recession or
                              depression), oil demand and prices
                              fall.
 
 The
                    crude
                    oil industry experiences numerous operating risks. These operating
                    risks include
                    the risk of fire, explosions, blow-outs, pipe failure, abnormally
                    pressured
                    formations and environmental hazards. Environmental hazards include
                    oil spills,
                    natural gas leaks, ruptures and discharges of toxic gases.
 
 Crude
                    oil
                    operations also are subject to various U.S. federal, state and
                    local regulations
                    that materially affect operations. Matters regulated include
                    discharge permits
                    for drilling operations, drilling and abandonment bonds, reports
                    concerning
                    operations, the spacing of wells and pooling of properties and
                    taxation. At
                    various times, regulatory agencies have imposed price controls
                    and limitations
                    on production. In order to conserve supplies of crude oil and
                    natural gas, these
                    agencies have restricted the rates of flow of crude oil and natural
                    gas wells
                    below actual production capacity. Federal, state, and local laws
                    regulate
                    production, handling, storage, transportation and disposal of
                    crude oil and
                    natural gas, by-products from crude oil and natural gas and other
                    substances and
                    materials produced or used in connection with crude oil and natural
                    gas
                    operations.
 
 The
                    price of US12OF’s units may be influenced by factors such as the supply and
                    demand for crude oil and the supply and demand for US12OF’s units. This may
                    cause the units to trade at a price that is above or below US12OF’s NAV per
                    unit. Accordingly, changes in the price of units may substantially
                    vary from
                    changes in the price of light, sweet crude oil. If this variation
                    occurs, then
                    investors may not be able to effectively use US12OF as a way
                    to hedge against
                    crude oil-related losses or as a way to indirectly invest in
                    crude
                    oil.
 
 While
                    it
                    is expected that the trading prices of the units will fluctuate
                    in accordance
                    with the changes in US12OF’s NAV, the prices of units may also be influenced by
                    other factors, including the supply and demand for crude oil
                    and the units.
                    There is no guarantee that the units will not trade at appreciable
                    discounts
                    from, and/or premiums to, US12OF’s NAV. This could cause the changes in the
                    price of the units to substantially vary from the changes in
                    the price of light,
                    sweet crude oil. This may be harmful to investors because if
                    changes in the
                    price of units vary substantially from changes in the Benchmark
                    Futures Contract
                    or the spot price of light, sweet crude oil, then investors may
                    not be able to
                    effectively use US12OF as a way to hedge the risk of losses in
                    their crude
                    oil-related transactions or as a way to indirectly invest in
                    crude oil.
 
 34
 Changes
                  in US12OF’s NAV may not correlate with changes in the price of the Benchmark
                  Futures Contracts. If this were to occur, investors may not be
                  able to
                  effectively use US12OF as a way to hedge against crude oil-related
                  losses or as
                  a way to indirectly invest in crude oil.
 
 The
                  General Partner will endeavor to invest US12OF’s assets as fully as possible in
                  Futures Contracts and Other Crude Oil-Related Investments so that
                  the changes in
                  percentage terms in the NAV will closely correlate with the changes
                  in
                  percentage terms in the price of the Benchmark Futures Contracts.
                  However,
                  changes in US12OF’s NAV may not correlate with changes in the price of the
                  Benchmark Futures Contracts for several reasons as set forth below:
 
 ·
                        US12OF
                            (i) may not be able to buy/sell the exact amount of Futures
                            Contracts and
                            Other Crude Oil-Related Investments to have a perfect
                            correlation with
                            NAV; (ii) may not always be able to buy and sell Futures
                            Contracts or
                            Other Crude Oil-Related Investments at the market price;
                            (iii) may not
                            experience a perfect correlation between the Benchmark
                            Futures Contract
                            and the underlying investments in Futures Contracts,
                            Other Crude
                            Oil-Related Investments and Treasuries, cash and/or cash
                            equivalents; and
                            (iv) is required to pay fees, including brokerage fees
                            and the management
                            fee, which will have an effect on the
                            correlation.
  ·
                        Supply
                            and demand for crude oil may cause the changes in the
                            market price of the
                            Benchmark Futures Contracts to vary from changes in US12OF’s NAV if US12OF
                            has fully invested in Futures Contracts that do not reflect
                            such supply
                            and demand and it is unable to replace such contracts
                            with Futures
                            Contracts that do reflect such supply and
                            demand.
  ·
                        US12OF
                            plans to buy only as many Futures Contracts and Other
                            Crude Oil-Related
                            Investments that it can to get the changes in percentage
                            terms of the NAV
                            as close as possible to the changes in percentage terms
                            in the price of
                            the Benchmark Futures Contracts. The remainder of its
                            assets will be
                            invested in Treasuries, cash and/or cash equivalents
                            and will be used to
                            satisfy initial margin and additional margin requirements,
                            if any, and to
                            otherwise support its investments in Crude Oil Interests.
                            Investments in
                            Treasuries, cash and/or cash equivalents, both directly
                            and as margin,
                            will provide rates of return that will vary from changes
                            in the value of
                            the price of light, sweet crude oil and the price of
                            the Benchmark Futures
                            Contract.
  ·
                        In
                            addition, because US12OF will incur certain expenses
                            in connection with
                            its investment activities, and will hold most of its
                            assets in more liquid
                            short-term securities for margin and other liquidity
                            purposes and for
                            redemptions that may be necessary on an ongoing basis,
                            the General Partner
                            will not be able to fully invest US12OF’s assets in Futures Contracts or
                            Other Crude Oil-Related Investments and there cannot
                            be perfect
                            correlation between changes in US12OF’s NAV and changes in the price of
                            the Benchmark Futures Contracts.
  ·
                        As
                            US12OF grows, there may be more or less correlation.
                            For example, if
                            US12OF only has enough money to buy three Benchmark Futures
                            Contracts and
                            it needs to buy four contracts to track the price of
                            light, sweet crude
                            oil then the correlation will be lower, but if it buys
                            20,000 Benchmark
                            Futures Contracts and it needs to buy 20,001 contracts
                            then the
                            correlation will be higher. At certain asset levels,
                            US12OF may be limited
                            in its ability to purchase the Benchmark Futures Contracts
                            or other
                            Futures Contracts due to accountability levels imposed
                            by the relevant
                            exchanges. To the extent that US12OF invests in these
                            other Futures
                            Contracts or Other Crude Oil-Related Investments, the
                            correlation with the
                            Benchmark Futures Contracts may be lower. If US12OF is
                            required to invest
                            in other Futures Contracts and Other Crude Oil-Related
                            Investments that
                            are less correlated with the Benchmark Futures Contracts,
                            US12OF would
                            likely invest in over-the-counter contracts to increase
                            the level of
                            correlation of US12OF’s assets. Over-the-counter contracts entail certain
                            risks described below under “Over-the-Counter Contract
                            Risk.”
  ·
                        US12OF
                            anticipates that it will invest in equal amounts of each
                            of the Benchmark
                            Futures Contracts. Certain months of these futures contracts
                            may have less
                            liquidity and availability than other months of these
                            future contracts.
                            The inability to purchase and hold the Benchmark Futures
                            Contracts in
                            equal amounts may cause less correlation between the
                            units’ NAV and the
                            average of the prices of the Benchmark Futures
                            Contracts.
  ·
                        US12OF
                            may not be able to buy the exact number of Futures Contracts
                            and Other
                            Crude Oil-Related Investments to have a perfect correlation
                            with the
                            Benchmark Futures Contracts if the purchase price of
                            Futures Contracts
                            required to be fully invested in such contracts is higher
                            than the
                            proceeds received for the sale of a Creation Basket on
                            the day the basket
                            was sold. In such case, US12OF could not invest the entire
                            proceeds from
                            the purchase of the Creation Basket in such futures contracts
                            (for
                            example, assume US12OF receives $4,000,000 for the sale
                            of a Creation
                            Basket and assume that the average of the prices of the
                            Futures Contracts
                            for crude oil that reflects the prices of the Benchmark
                            Futures Contracts
                            is $65.94, then US12OF could only invest in Futures Contracts
                            with an
                            aggregate value of $3,956,700), US12OF would be required
                            to invest a
                            percentage of the proceeds in Treasuries to be deposited
                            as margin with
                            the futures commission merchant through which the contract
                            was purchased.
                            The remainder of the purchase price for the Creation
                            Basket would remain
                            invested in Treasuries, cash and/or cash equivalents
                            as determined by the
                            General Partner from time to time based on factors such
                            as potential calls
                            for margin or anticipated redemptions. If the trading
                            market for Futures
                            Contracts is suspended or closed, US12OF may not be able
                            to purchase these
                            investments at the last reported price for such
                            investments.
  ·
                        US12OF
                            may make use of “mini” contracts as a way of investing a dollar amount in
                            contracts that may more closely match the dollar amount
                            of net assets of
                            the fund. However, even the use of mini contracts does
                            not completely
                            eliminate the risk that US12OF will not be able to buy
                            or sell the exact
                            number of Futures Contracts necessary. In addition there
                            is a risk that
                            because of the size and relative liquidity of such contracts
                            when compared
                            to standard size Futures Contracts such as the Benchmark
                            Futures
                            Contracts, the price of a smaller contract for a particular
                            month may not
                            equate to the Benchmark Futures Contract for the same
                            month, which could
                            cause the change in the US12OF’s per unit price and NAV to vary from
                            changes in the average price of the Benchmark Futures
                            Contracts.
 
 If
                  changes in US12OF’s NAV do not correlate with changes in the price of the
                  Benchmark Futures Contracts, then investing in US12OF may not be
                  an effective
                  way to hedge against crude oil-related losses or indirectly invest
                  in crude
                  oil.
 
 The
                  Benchmark Futures Contracts may not correlate with the price of
                  light, sweet
                  crude oil and this could cause the changes in the price of units
                  to
                  substantially vary from changes in the price of light, sweet crude
                  oil. If this
                  were to occur, then investors may not be able to effectively use
                  US12OF as a way
                  to hedge against crude oil-related losses or as a way to indirectly
                  invest in
                  crude oil.
 
 When
                  using the Benchmark Futures Contracts as a strategy to track the
                  price of light,
                  sweet crude oil, at best the correlation between changes in prices
                  of such Crude
                  Oil Interests and the delivery price of crude oil can be only approximate.
                  The
                  degree of imperfection of correlation depends upon circumstances
                  such as
                  variations in the speculative crude oil market, supply of and demand
                  for such
                  Crude Oil Interests and technical influences in futures trading.
                  If there is a
                  weak correlation between the Crude Oil Interests and the price
                  of light, sweet
                  crude oil, then the price of units may not accurately track the
                  price of light,
                  sweet crude oil and investors may not be able to effectively use
                  US12OF as a way
                  to hedge the risk of losses in their crude oil-related transactions
                  or as a way
                  to indirectly invest in crude oil.
 35
 US12OF
                  may experience a loss if it is required to sell Treasuries at a
                  price lower than
                  the price at which they were acquired.
 
 The
                  value
                  of Treasuries generally moves inversely with movements in interest
                  rates. If
                  US12OF is required to sell Treasuries at a price lower than the
                  price at which
                  they were acquired, US12OF will experience a loss. This loss may
                  adversely
                  impact the price of the units and may decrease the correlation
                  between the price
                  of the units, the price of the Benchmark Futures Contracts and
                  Other Crude
                  Oil-Related Investments, and the delivery price of light, sweet
                  crude
                  oil.
 
 Certain
                  of US12OF’s investments could be illiquid which could cause large losses
                  to
                  investors at any time or from time to time.
 
 At
                  any
                  given time, US12OF may own 12 different monthly crude oil contracts
                  which have
                  differing expiration schedules. The amount of liquidity in the
                  crude oil futures
                  market for each of those months will vary. In some cases certain
                  of those months
                  may have relatively small amounts of open interest and daily trading
                  volume. As
                  a result, US12OF may not always be able to liquidate its positions
                  in its
                  investments at the desired price. It is difficult to execute a
                  trade at a
                  specific price when there is a relatively small volume of buy and
                  sell orders in
                  a market. A market disruption, such as a foreign government taking
                  political
                  actions that disrupt the market in its currency, its crude oil
                  production or
                  exports, or in another major export, can also make it difficult
                  to liquidate a
                  position. Alternatively, limits imposed by futures exchanges or
                  other regulatory
                  organizations, such as accountability levels, position limits and
                  price
                  fluctuation limits, may contribute to a lack of liquidity with
                  respect to some
                  Crude Oil Interests.
 
 Unexpected
                  market illiquidity may cause major losses to investors at any time
                  or from time
                  to time. In addition, US12OF does not intend at this time to establish
                  a credit
                  facility, which would provide an additional source of liquidity
                  and instead will
                  rely only on the Treasuries, cash and/or cash equivalents that
                  it holds. The
                  anticipated large value of the positions in Futures Contracts that
                  the General
                  Partner will acquire or enter into for US12OF increases the risk
                  of illiquidity.
                  Other Crude Oil-Related Investments that US12OF invests in, such
                  as negotiated
                  over-the-counter contracts, may have a greater likelihood of being
                  illiquid
                  since they are contracts between two parties that take into account
                  not only
                  market risk, but also the relative credit, tax, and settlement
                  risks under such
                  contracts. Such contracts also have limited transferability that
                  results from
                  such risks and from the contract’s express limitations.
 
 Because
                  both Futures Contracts and Other Crude Oil-Related Investments
                  may be illiquid,
                  US12OF’s Crude Oil Interests may be more difficult to liquidate at favorable
                  prices in periods of illiquid markets and losses may be incurred
                  during the
                  period in which positions are being liquidated.
 
 If
                  the nature of hedgors and speculators in futures markets has shifted
                  such that
                  crude oil purchasers are the predominant hedgors in the market,
                  US12OF might
                  have to reinvest at higher futures prices or choose Other Crude
                  Oil-Related
                  Investments.
 
 The
                  changing nature of the hedgors and speculators in the crude oil
                  market will
                  influence whether futures prices are above or below the expected
                  future spot
                  price. In order to induce speculators to take the corresponding
                  long side of the
                  same futures contract, crude oil producers must generally be willing
                  to sell
                  futures contracts at prices that are below expected future spot
                  prices.
                  Conversely, if the predominant hedgors in the futures market are
                  the purchasers
                  of the crude oil who purchase futures contracts to hedge against
                  a rise in
                  prices, then speculators will only take the short side of the futures
                  contract
                  if the futures price is greater than the expected future spot price
                  of crude
                  oil. This can have significant implications for US12OF when it
                  is time to
                  reinvest the proceeds from a maturing Futures Contract into a new
                  Futures
                  Contract.
 36
 While
                    US12OF does not intend to take physical delivery of crude oil
                    under its Futures
                    Contracts, physical delivery under such contracts impacts the
                    value of the
                    contracts.
 While
                      it
                      is not the current intention of US12OF to take physical delivery
                      of crude oil
                      under its Futures Contracts, futures contracts are not required
                      to be
                      cash-settled and it is possible to take delivery under these
                      contracts. Storage
                      costs associated with purchasing crude oil could result in
                      costs and other
                      liabilities that could impact the value of Futures Contracts
                      or Other Crude
                      Oil-Related Investments. Storage costs include the time value
                      of money invested
                      in crude oil as a physical commodity plus the actual costs
                      of storing the crude
                      oil less any benefits from ownership of crude oil that are
                      not obtained by the
                      holder of a futures contract. In general, Futures Contracts
                      have a one-month
                      delay for contract delivery and the back month (the back month
                      is any future
                      delivery month other than the spot month) includes storage
                      costs. To the extent
                      that these storage costs change for crude oil while US12OF
                      holds Futures
                      Contracts or Other Crude Oil-Related Investments, the value
                      of the Futures
                      Contracts or Other Crude Oil-Related Investments, and therefore
                      US12OF’s NAV,
                      may change as well. Because it holds Futures Contracts that
                      will mature up to 13
                      months later than the spot or current month, US12OF’s NAV will be impacted more
                      from the changes in storage costs than would the NAV of a fund
                      that holds more
                      current futures contracts.
 
 The
                      price relationship between the near month contract and the
                      other monthly
                      contracts that compose the Benchmark Futures Contracts will
                      vary and may impact
                      both the total return over time of US12OF’s NAV, as well as the degree to which
                      its total return tracks other crude oil price indices’ total
                      returns.
 
 The
                      Benchmark Futures Contracts consist of the near month contract
                      to expire and the
                      contracts for the following eleven months, except during the
                      last two weeks of
                      the current month when the near month contract is sold and
                      replaced by the
                      futures contract for the thirteenth month following the current
                      month. In the
                      event of a crude oil futures market where near month contracts
                      trade at a higher
                      price than the price of contracts that expire later in time,
                      a situation
                      described as “backwardation” in the futures market, then absent the impact of
                      the overall movement in crude oil prices the value of the benchmark
                      contract
                      would tend to rise as it approaches expiration. As a result
                      the total return of
                      the Benchmark Futures Contract would tend to track higher.
                      Conversely, in the
                      event of a crude oil futures market where near month contracts
                      trade at a lower
                      price than the price of contracts that expire later in time,
                      a situation
                      described as “contango” in the futures market, then absent the impact of the
                      overall movement in crude oil prices the value of the benchmark
                      contract would
                      tend to decline as it approaches expiration. As a result the
                      total return of the
                      Benchmark Futures Contract would tend to track lower. When
                      compared to total
                      return of other price indices, such as the spot price of crude
                      oil, the impact
                      of backwardation and contango may lead the total return of
                      US12OF’s NAV to vary
                      significantly. In the event of a prolonged period of contango,
                      and absent the
                      impact of rising or falling crude oil prices, this could have
                      a significant
                      negative impact on US12OF’s NAV and total return. Furthermore, a portfolio that
                      consists of twelve different monthly contracts, ranging in
                      a “strip” from the
                      first month to the twelfth month, will be impacted differently
                      by contango and
                      backwardation than a portfolio that consists of just the first
                      month
                      contract.
 
 Because
                      US12OF’s portfolio will typically hold as many as 12 different crude
                      oil futures
                      contracts at all times, it may be more expensive for US12OF
                      to buy or sell
                      futures contracts for its portfolio.
 
 Because
                      US12OF will typically hold as many as 12 different futures
                      contracts at any one
                      time, the cost of trading a large number of different contracts
                      could be greater
                      than the cost of trading the same dollar amount using just
                      one contract. In
                      addition, the bid/ask spread for buying these different contracts
                      could also on
                      average be greater than the bid/ask spread for buying a single
                      futures contract
                      month. This could make it more expensive for US12OF to invest
                      compared to
                      investing in a single monthly contract. Wider bid/ask spreads
                      and/or higher
                      commission or brokerage costs would negatively impact an investor’s investment
                      returns in US12OF.
 
 Because
                      US12OF’s portfolio will typically hold as many as 12 different crude
                      oil futures
                      contracts at all times, firms that make a market in the units
                      will also need to
                      hold multiple contracts when hedging their inventories of units
                      and when
                      creating or redeeming baskets. This could lead to the units
                      of US12OF trading at
                      wider bid/ask spreads in the secondary market than an exchange
                      traded security
                      holding crude oil futures that uses a fewer number of futures
                      contracts at any
                      given time.
 
 Brokerage
                      firms or other market participants that make a secondary market
                      in the units of
                      US12OF may do so by simultaneously hedging their positions
                      by being long, or
                      short, the same Futures Contracts that US12OF holds in its
                      portfolio. The cost
                      to brokerage firms or other market participants in putting
                      on and taken off
                      these hedges is one of the factors that determine the size
                      of the bid/ask spread
                      they quote on a security such as US12OF. Because US12OF will
                      typically hold as
                      many as 12 different futures contracts at any one time, the
                      brokerage firms or
                      other market participants will also find themselves having
                      to trade a number of
                      different contracts as well. The cost of trading a large number
                      of different
                      contracts may be greater than the cost of trading the same
                      dollar amount using
                      just one contract. As a result, the bid/ask spread for US12OF
                      may be wider than
                      the bid/ask spread for an exchange traded security investing
                      in a fewer number
                      of futures contracts at any given time. The wider bid/ask spread
                      may negatively
                      impact an investor’s investment returns in US12OF.
  37
 
 Regulation
                    of the commodity interests and energy markets is extensive and
                    constantly
                    changing; future regulatory developments are impossible to predict
                    but may
                    significantly and adversely affect US12OF.
 The
                      regulation of commodity interest transactions in the United
                      States is a rapidly
                      changing area of law and is subject to ongoing modification
                      by governmental and
                      judicial action. In addition, various national governments
                      have expressed
                      concern regarding the disruptive effects of speculative trading
                      in the energy
                      markets and the need to regulate the derivatives markets in
                      general. The effect
                      of any future regulatory change on US12OF is impossible to
                      predict, but could be
                      substantial and adverse.
 
 If
                      an investor invests in US12OF for purposes of hedging, it might
                      be subject to
                      several risks including the possibility of losing the benefit
                      of favorable
                      market movement.
 
 While
                      US12OF does not intend to engage in hedging strategies, participants
                      in the
                      crude oil or in other industries may use US12OF as a vehicle
                      to hedge the risk
                      of losses in their crude oil-related transactions. There are
                      several risks in
                      connection with using US12OF as a hedging device. While hedging
                      can provide
                      protection against an adverse movement in market prices, it
                      can also preclude a
                      hedgor’s opportunity to benefit from a favorable market movement.
                      In a hedging
                      transaction, the hedgor may be concerned that the hedged item
                      will increase in
                      price, but must recognize the risk that the price may instead
                      decline and if
                      this happens he will have lost his opportunity to profit from
                      the change in
                      price because the hedging transaction will result in a loss
                      rather than a gain.
                      Thus, the hedgor foregoes the opportunity to profit from favorable
                      price
                      movements.
 
 In
                      addition, if the hedge is not a perfect one, the hedgor can
                      lose on the hedging
                      transaction and not realize an offsetting gain in the value
                      of the underlying
                      item being hedged.
 
 When
                      using futures contracts as a hedging technique, at best, the
                      correlation between
                      changes in prices of futures contracts and of the items being
                      hedged can be only
                      approximate. The degree of imperfection of correlation depends
                      upon
                      circumstances such as: variations in speculative markets, demand
                      for futures and
                      for crude oil products, technical influences in futures trading,
                      and differences
                      between anticipated energy costs being hedged and the instruments
                      underlying the
                      standard futures contracts available for trading. Even a well-conceived
                      hedge
                      may be unsuccessful to some degree because of unexpected market
                      behavior as well
                      as the expenses associated with creating the hedge.
 
 In
                      addition, using an investment in US12OF as a hedge for changes
                      in energy costs
                      (e.g.,
                      investing in
                      crude oil, heating oil, gasoline, natural gas or other fuels,
                      or electricity)
                      may not correlate because changes in the spot price of crude
                      oil may vary from
                      changes in energy costs because the spot price may not be at
                      the same rate as
                      changes in the price of other energy products, and, in any
                      case, the price of
                      crude oil does not reflect the refining, transportation, and
                      other costs that
                      may impact the hedgor’s energy costs.
 
 An
                      investment in US12OF may provide investors little or no diversification
                      benefits. Thus, in a declining market, US12OF may have no gains
                      to offset an
                      investor’s  losses from other investments, and an investor may suffer
                      losses on its  investment in US12OF at the same time
                      it  incurs losses with respect to other asset classes.
 
 Historically,
                      Futures Contracts and Other Crude Oil-Related Investments have
                      generally been
                      non-correlated to the performance of other asset classes such
                      as stocks and
                      bonds. Non-correlation means that there is a low statistically
                      valid
                      relationship between the performance of futures and other commodity
                      interest
                      transactions, on the one hand, and stocks or bonds, on the
                      other hand. However,
                      there can be no assurance that such non-correlation will continue
                      during future
                      periods. If, contrary to historic patterns, US12OF’s performance were to move in
                      the same general direction as the financial markets, an investor
                      will obtain
                      little or no diversification benefits from an investment in
                      the units. In such a
                      case, US12OF may have no gains to offset an investor’s losses from other
                      investments, and an investor may suffer losses on its investment
                      in US12OF at
                      the same time it incurs losses with respect to other investments.
 
 Variables
                      such as drought, floods, weather, embargoes, tariffs and other
                      political events
                      may have a larger impact on crude oil prices and crude oil-linked
                      instruments,
                      including Futures Contracts and Other Crude Oil-Related Investments,
                      than on
                      traditional securities. These additional variables may create
                      additional
                      investment risks that subject US12OF’s investments to greater volatility than
                      investments in traditional securities.
 
 Non-correlation
                      should not be confused with negative correlation, where the
                      performance of two
                      asset classes would be opposite of each other. There is no
                      historic evidence
                      that the spot price of crude oil and prices
                      of
                      other financial assets, such as stocks and bonds, are negatively
                      correlated. In
                      the absence of negative correlation, US12OF cannot be expected
                      to be
                      automatically profitable during unfavorable periods for the
                      stock market, or
                      vice versa.
  38
 
 US12OF’s
                      Operating Risks
 
 US12OF
                      is not a registered investment company so investors do not
                      have the protections
                      of the 1940 Act.
 
 US12OF
                      is
                      not an investment company subject to the 1940 Act. Accordingly,
                      investors do not
                      have the protections afforded by that statute which, for example,
                      requires
                      investment companies to have a majority of disinterested directors
                      and regulates
                      the relationship between the investment company and its investment
                      manager.
 
 US12OF
                      has no operating history so there is no performance history
                      to serve as a basis
                      for an investor to evaluate an investment in US12OF.
 
 US12OF
                      is
                      new and has no operating history. Therefore, an investor does
                      not have the
                      benefit of reviewing the past performance of US12OF as a basis
                      for an investor
                      to evaluate an investment in US12OF. The General Partner’s current experience
                      involves managing USOF, an exchange traded security that invests primarily
                      in Futures Contracts for light, sweet crude oil, Treasuries,
                      cash and/or cash
                      equivalents. However, USOF has a different Benchmark Futures
                      Contract than
                      US12OF. USOF’s Benchmark Futures Contract consists of a single contract
                      which is
                      the contract nearest to expiration (unless that contract is
                      within two weeks of
                      expiration in which case it is the next nearest month to expiration).
                      The use of
                      a single contract as its benchmark means that the General Partner’s experience
                      with USOF may not be directly applicable to US12OF.
 The
                          General Partner’s current experience also involves managing USNG, an
                          exchange traded security that invests primarily in Futures
                          Contracts for natural
                          gas, Treasuries, cash and/or cash equivalents. However,
                          there are significant
                          differences between the natural gas futures market and
                          that of crude oil
                          futures. The General Partner’s results with USNG may not be representative of
                          results that may be experienced with a fund investing in
                          crude oil
                          futures.
  The
                          General Partner’s current experience also
                          involves managing USG, an exchange traded security that
                          invests primarily in
                          Futures Contracts for gasoline, cash and/or cash
                          equivalents.  However, there are significant differences between the
                          gasoline futures market and that of crude oil futures.  The General
                          Partner’s results with USG may not be representative of results
                          that may be
                          experienced with a fund investing in crude oil futures.
 
 The
                      General Partner is leanly staffed and relies heavily on key
                      personnel to manage
                      trading activities.
 
 In
                      managing and directing the day-to-day activities and affairs
                      of US12OF, the
                      General Partner relies heavily on Messrs. Nicholas Gerber, John Love
                      and John Hyland. If Messrs. Gerber, Love or Hyland were to leave
                      or be unable to carry out their present responsibilities, it
                      may have an adverse
                      effect on the management of US12OF. Furthermore, Messrs. Gerber,
                      Hyland
                      and Love currently are involved in the management of USOF, USNG
                      and
                      USG and the General Partner is currently in the process of registering
                      two
                      other exchange traded securities, USHO and US12NG. Messrs.
                      Gerber and Love
                      are also employed by Ameristock Corporation, a registered investment
                      adviser
                      that manages a public mutual fund. It is estimated that Mr.
                      Gerber will spend
                      approximately 50% of his time on US12OF, USNG, USOF, USG, USHO and
                      US12NG matters. Mr. Love will spend approximately 95% of his time
                      on
                      US12OF, USNG, USOF, USG, USHO and US12NG matters and Mr. Hyland will spend
                      approximately 75% of his time on US12OF, USNG, USOF, USG, USHO and
                      US12NG matters. To the extent that the General Partner establishes
                      additional funds, even greater demands will be placed on Messrs.
                      Gerber, Love and Hyland, as well as the other officers of the General
                      Partner, including Mr. Mah, the Chief Financial Officer, and
                      its Board of
                      Directors.
 
 Accountability
                      levels, position limits, and daily price fluctuation limits
                      set by the exchanges
                      have the potential to cause a tracking error, which could cause
                      the price of
                      units to substantially vary from the price of the Benchmark
                      Futures Contracts
                      and prevent an investor from being able to effectively use
                      US12OF as a way to
                      hedge against crude oil-related losses or as a way to indirectly
                      invest in crude
                      oil.
 
 U.S.
                      designated contract markets such as the NYMEX have established
                      accountability
                      levels and position limits on the maximum net long or net short
                      futures
                      contracts in commodity interests that any person or group of
                      persons under
                      common trading control (other than as a hedge, which an investment
                      in US12OF is
                      not) may hold, own or control. For example, the current accountability
                      level for
                      investments at any one time in the Benchmark Futures Contract is 20,000.
                      While this is not a fixed ceiling, it is a threshold above
                      which the NYMEX may
                      exercise greater scrutiny and control over an investor, including
                      limiting an
                      investor to holding no more than 20,000 Benchmark Futures Contracts.
                      With regard
                      to position limits, the NYMEX limits an investor from holding
                      more than 3,000
                      net futures in the last 3 days of trading in the near month
                      contract to
                      expire.
 
 In
                      addition to accountability levels and position limits, the
                      NYMEX also sets daily
                      price fluctuation limits on the Benchmark Futures Contracts.
                      The daily price
                      fluctuation limit establishes the maximum amount that the price
                      of a futures
                      contract may vary either up or down from the previous day’s settlement price.
                      Once the daily price fluctuation limit has been reached in
                      a particular Futures
                      Contract, no trades may be made at a price beyond that limit.
 
 For
                      example, the NYMEX imposes a $10.00 per barrel ($10,000 per
                      contract) price
                      fluctuation limit for the Benchmark Futures Contracts. This
                      limit is initially
                      based off of the previous trading day’s settlement price. If any Benchmark
                      Futures Contract is traded, bid, or offered at the limit for
                      five minutes,
                      trading is halted for five minutes. When trading resumes it
                      begins at the point
                      where the limit was imposed and the limit is reset to be $10.00
                      per barrel in
                      either direction of that point. If another halt were triggered,
                      the market would
                      continue to be expanded by $10.00 per barrel in either direction
                      after each
                      successive five-minute trading halt. There is no maximum price
                      fluctuation limit
                      during any one trading session.
 
 All
                      of
                      these limits may potentially cause a tracking error between
                      the price of the
                      units and the price of the Benchmark Futures Contracts. This
                      may in turn prevent
                      an investor from being able to effectively use US12OF as a
                      way to hedge against
                      crude oil-related losses or as a way to indirectly invest in
                      crude
                      oil.
 
 US12OF
                      is
                      not limiting the size of the offering and is committed to utilizing
                      substantially all of its proceeds to purchase Futures Contracts
                      and Other Crude
                      Oil-Related Investments. If US12OF encounters accountability
                      levels, position
                      limits, or price fluctuation limits for crude oil contracts
                      on the NYMEX, it may
                      then, if permitted under applicable regulatory requirements,
                      purchase Futures
                      Contracts on the ICE Futures (formerly, the International Petroleum
                      Exchange) or
                      other exchanges that trade listed crude oil futures. The Futures
                      Contracts
                      available on the ICE Futures are comparable to the contracts
                      on the NYMEX, but
                      they may have different underlying commodities, sizes, deliveries,
                      and
                      prices.
  39
 
 There
                      are technical and fundamental risks inherent in the trading
                      system the General
                      Partner intends to employ.
 
 The
                      General Partner’s trading system is quantitative in nature and it is possible
                      that the General Partner might make a mathematical error. In
                      addition, it is
                      also possible that a computer or software program may malfunction
                      and cause an
                      error in computation.
 
 US12OF
                      and the General Partner may have conflicts of interest, which
                      may permit them to
                      favor their own interests to the detriment of an investor.
 
 US12OF
                      and the General Partner may have inherent conflicts to the
                      extent the General
                      Partner attempts to maintain US12OF’s asset size in order to preserve its fee
                      income and this may not always be consistent with US12OF’s objective of having
                      the value of its unit’s NAV track changes in the price of the Benchmark Futures
                      Contracts. The General Partner’s officers, directors and employees do not devote
                      their time exclusively to US12OF. These persons are directors,
                      officers or
                      employees of other entities that may compete with US12OF for
                      their services.
                      They could have a conflict between their responsibilities to
                      US12OF and to those
                      other entities.
 
 In
                      addition, the General Partner’s principals, officers, directors or employees may
                      trade futures and related contracts for their own account.
                      A conflict of
                      interest may exist if their trades are in the same markets
                      and at the same time
                      as US12OF trades using the clearing broker to be used by US12OF.
                      A potential
                      conflict also may occur if the General Partner’s principals, officers, directors
                      or employees trade their accounts more aggressively or take
                      positions in their
                      accounts which are opposite, or ahead of, the positions taken
                      by
                      US12OF.
 
 The
                      General Partner has sole current authority to manage the investments
                      and
                      operations of US12OF, and this may allow it to act in a way
                      that furthers its
                      own interests which may create a conflict with the best interests
                      of an
                      investor. Limited partners have limited voting control, which
                      will limit the
                      ability to influence matters such as amendment of the LP Agreement,
                      change in
                      US12OF’s basic investment policy, dissolution of this fund, or the
                      sale or
                      distribution of US12OF’s assets.
 
 The
                      General Partner serves as the general partner of each of USOF,
                      USNG, USG, USHO
                      and US12NG, as well as US12OF. The General Partner may have a conflict
                      to the extent that its trading decisions for US12OF may be
                      influenced by the
                      effect they would have on the other funds it manages. These
                      trading decisions
                      may be influenced since the General Partner also serves as
                      the general partner
                      for all of the funds, and is required to meet all of the funds’ investment
                      objectives as well as US12OF’s. If the General Partner believes that a trading
                      decision it made on behalf of US12OF might (i) impede its other
                      funds from
                      reaching their investment objectives, or (ii) improve the likelihood
                      of meeting
                      its other funds’ objectives, then the General Partner may choose to change its
                      trading decision for US12OF, which could either impede or improve
                      the
                      opportunity for US12OF from meeting its investment objective.
                      In addition, the
                      General Partner is required to indemnify the officers and directors
                      of its other
                      funds if the need for indemnification arises. This potential
                      indemnification
                      will cause the General Partner’s assets to decrease. If the General Partner’s
                      other sources of income are not sufficient to compensate for
                      the
                      indemnification, then the General Partner may terminate and
                      an investor could
                      lose its investment.
 
 Unitholders
                      may only vote on the removal of the General Partner and limited
                      partners have
                      only limited voting rights. Unitholders and limited partners
                      will not
                      participate in the management of US12OF and do not control
                      the General Partner
                      so they will not have influence over basic matters that affect
                      US12OF.
 
 Unitholders
                      that have not applied to become limited partners have no voting
                      rights, other
                      than to remove the General Partner. Limited partners will have
                      limited voting
                      rights with respect to US12OF’s affairs. Unitholders may remove the General
                      Partner only if 66 and 2/3% of the unitholders elect to do
                      so. Unitholders and
                      limited partners will not be permitted to participate in the
                      management or
                      control of US12OF or the conduct of its business. Unitholders
                      and limited
                      partners must therefore rely upon the duties and judgment of
                      the General Partner
                      to manage US12OF’s affairs.
  40
 
 The
                      General Partner may manage a large amount of assets and this
                      could affect
                      US12OF’s ability to trade profitably.
 
 Increases
                      in assets under management may affect trading decisions. In
                      general, the General
                      Partner does not intend to limit the amount of assets of US12OF that it
                      may
                      manage. The more assets the General Partner manages, the more
                      difficult it may
                      be for it to trade profitably because of the difficulty of
                      trading larger
                      positions without adversely affecting prices and performance
                      and of managing
                      risk associated with larger positions.
 
 US12OF
                      could terminate at any time and cause the liquidation and potential
                      loss of an
                      investor’s investment and could upset the overall maturity and timing
                      of
                      an investor’s investment portfolio.
 
 US12OF
                      may terminate at any time, regardless of whether US12OF has
                      incurred losses,
                      subject to the terms of the LP Agreement. In particular, unforeseen
                      circumstances, including the death, adjudication of incompetence,
                      bankruptcy,
                      dissolution, or removal of the General Partner could cause
                      US12OF to terminate
                      unless a majority interest of the limited partners within 90
                      days of the event
                      elects to continue the partnership and appoints a successor
                      general partner.
                      However, no level of losses will require the General Partner
                      to terminate
                      US12OF. US12OF’s termination would cause the liquidation and potential loss
                      of
                      an investor’s investment. Termination could also negatively affect the
                      overall
                      maturity and timing of an investor’s investment portfolio.
 
 Limited
                      partners may not have limited liability in certain circumstances,
                      including
                      potentially having liability for the return of wrongful
                      distributions.
 
 Under
                      Delaware law, a limited partner might be held liable for our
                      obligations as if
                      it were a General Partner if the limited partner participates
                      in the control of
                      the partnership’s business and the persons who transact business with the
                      partnership think the limited partner is the General Partner.
 
 A
                      limited
                      partner will not be liable for assessments in addition to its
                      initial capital
                      investment in any of our capital securities representing
                      units.  However, a limited partner may be required to repay to us any
                      amounts wrongfully returned or distributed to it under some
                      circumstances. Under
                      Delaware law, US12OF may not make a distribution to limited
                      partners if the
                      distribution causes our liabilities (other than liabilities
                      to partners on
                      account of their partnership interests and nonrecourse liabilities)
                      to exceed
                      the fair value of our assets. Delaware law provides that a
                      limited partner who
                      receives such a distribution and knew at the time of the distribution
                      that the
                      distribution violated the law will be liable to the limited
                      partnership for the
                      amount of the distribution for three years from the date of
                      the
                      distribution.
 
 With
                      adequate notice, a limited partner may be required to withdraw
                      from the
                      partnership for any reason.
 
 If
                      the
                      General Partner gives at least fifteen (15) days’ written notice to a limited
                      partner, then the General Partner may for any reason, in its
                      sole discretion,
                      require any such limited partner to withdraw entirely from
                      the partnership or to
                      withdraw a portion of its partner capital account. The General
                      Partner may
                      require withdrawal even in situations where the limited partner
                      has complied
                      completely with the provisions of the LP Agreement.
  41
 
 US12OF’s
                      existing units are, and any units US12OF issues in the future
                      will be, subject
                      to restrictions on transfer. Failure to satisfy these requirements
                      will preclude
                      an investor from being able to have all the rights of a limited
                      partner.
 
 No
                      transfer of any unit or interest therein may be made if such
                      transfer would (a)
                      violate the then applicable federal or state securities laws
                      or rules and
                      regulations of the SEC, any state securities commission, the
                      CFTC or any other
                      governmental authority with jurisdiction over such transfer,
                      or (b) cause US12OF
                      to be taxable as a corporation or affect US12OF’s existence or qualification as
                      a limited partnership. In addition, investors may only become
                      limited partners
                      if they transfer their units to purchasers that meet certain
                      conditions outlined
                      in the LP Agreement, which provides that each record holder
                      or limited partner
                      or unitholder applying to become a limited partner (each a
                      record holder) may be
                      required by the General Partner to furnish certain information,
                      including that
                      holder’s nationality, citizenship or other related status. A transferee
                      who is
                      not a U.S. resident may not be eligible to become a record
                      holder or a limited
                      partner if its ownership would subject US12OF to the risk of
                      cancellation or
                      forfeiture of any of its assets under any federal, state or
                      local law or
                      regulation. All purchasers of US12OF’s units, who wish to become limited
                      partners or record holders, and receive cash distributions,
                      if any, or have
                      certain other rights, must deliver an executed transfer application
                      in which the
                      purchaser or transferee must certify that, among other things,
                      he, she or it
                      agrees to be bound by US12OF’s LP Agreement and is eligible to purchase US12OF’s
                      securities. Any transfer of units will not be recorded by the
                      transfer agent or
                      recognized by us unless a completed transfer application is
                      delivered to the
                      General Partner or the Administrator. A person purchasing US12OF’s existing
                      units, who does not execute a transfer application and certify
                      that the
                      purchaser is eligible to purchase those securities acquires
                      no rights in those
                      securities other than the right to resell those securities.
                      Whether or not a
                      transfer application is received or the consent of the General
                      Partner obtained,
                      our units will be securities and will be transferable according
                      to the laws
                      governing transfers of securities. See “Transfer of Units.”
 
 US12OF
                      does not expect to make cash distributions.
 
 The
                      General Partner intends to re-invest any realized gains in
                      Crude Oil Interests
                      rather than distributing cash to limited partners. Therefore,
                      unlike mutual
                      funds, commodity pools or other investment pools that actively
                      manage their
                      investments in an attempt to realize income and gains from
                      their investing
                      activities and distribute such income and gains to their investors,
                      US12OF
                      generally does not expect to distribute cash to limited partners.
                      An investor
                      should not invest in US12OF if it will need cash distributions
                      from US12OF to
                      pay taxes on its share of income and gains of US12OF, if any,
                      or for any other
                      reason. Although US12OF does not intend to make cash distributions,
                      the income
                      earned from its investments held directly or posted as margin
                      may reach levels
                      that merit distribution, e.g., at levels where such income
                      is not necessary to
                      support its underlying investments in crude oil interests and
                      an investor
                      adversely reacts to being taxed on such income without receiving
                      distributions
                      that could be used to pay such tax. If this income becomes
                      significant then cash
                      distributions may be made.
 
 There
                      is a risk that US12OF will not earn trading gains sufficient
                      to compensate for
                      the fees and expenses that it must pay and as such US12OF may
                      not earn any
                      profit.
 
 US12OF
                      pays brokerage charges of approximately 0.016% (including futures
                      commission
                      merchant fees of $4.00 per buy or sell), any licensing fees
                      for the use of
                      intellectual property, registration fees with the SEC, FINRA,
                      or other
                      regulatory agency in connection with offers and sales of the
                      units subsequent to
                      the initial offering of the units including the legal, printing,
                      accounting and
                      other expenses associated therewith. US12OF also pays the fees
                      and expenses,
                      including directors and officers liability insurance, of the
                      independent
                      directors, management fees of 0.60% of NAV on its average net
                      assets, tax
                      accounting and reporting costs and over-the-counter spreads
                      and extraordinary
                      expenses (i.e.
                      expenses
                      not in the ordinary course of business, including the indemnification
                      of any
                      person against liabilities and obligations to the extent permitted
                      by law and
                      required under the LP Agreement and under agreements entered
                      into by the General
                      Partner on US12OF’s behalf and the bringing and defending of actions at law or
                      in equity and otherwise engaging in the conduct of litigation
                      and the incurring
                      of legal expenses and the settlement of claims and litigation)
                      that cannot be
                      quantified. These fees and expenses must be paid in all cases
                      regardless of
                      whether US12OF’s activities are profitable. Accordingly, US12OF must earn
                      trading gains sufficient to compensate for these fees and expenses
                      before it can
                      earn any profit.
  42
 
 US12OF,
                      to date, has depended upon the General Partner to pay all its
                      expenses. If this
                      offering of units does not raise sufficient funds to pay US12OF’s future
                      expenses, the General Partner no longer pays such expenses
                      and no other source
                      of funding of expenses is found, US12OF will terminate and
                      an investor may lose
                      all or part of its investment.
 
 To
                      date,
                      all of US12OF’s expenses have been funded by the General Partner. If the
                      General
                      Partner and US12OF are unsuccessful in raising sufficient funds
                      to cover its
                      expenses or in locating any other source of funding, US12OF
                      will terminate and
                      an investor may lose all or part of its investment.
 
 US12OF
                      may incur higher fees and expenses upon renewing existing or
                      entering into new
                      contractual relationships.
 
 The
                      clearing arrangements between the clearing brokers and US12OF
                      generally are
                      terminable by the clearing brokers once the clearing broker
                      has given US12OF
                      notice. Upon termination, the General Partner may be required
                      to renegotiate or
                      make other arrangements for obtaining similar services if US12OF
                      intends to
                      continue trading in Futures Contracts or Other Crude Oil-Related
                      Investments at
                      its present level of capacity. The services of any clearing
                      broker may not be
                      available, or even if available, these services may not be
                      available on the
                      terms as favorable as those of the expired or terminated clearing
                      arrangements.
 
 US12OF
                      may miss certain trading opportunities because it will not
                      receive the benefit
                      of the expertise of independent trading advisors.
 
 The
                      General Partner does not employ trading advisors for US12OF;
                      however, it
                      reserves the right to employ them in the future. The only advisor
                      to US12OF is
                      the General Partner. A lack of independent trading advisors
                      may be
                      disadvantageous to US12OF because it will not receive the benefit
                      of a trading
                      advisor’s expertise.
 
 An
                      unanticipated number of redemption requests during a short
                      period of time could
                      have an adverse effect on the NAV of US12OF.
 
 If
                      a
                      substantial number of requests for redemption of Redemption
                      Baskets are received
                      by US12OF during a relatively short period of time, US12OF
                      may not be able to
                      satisfy the requests from US12OF’s assets not committed to trading. As a
                      consequence, it could be necessary to liquidate positions in
                      US12OF’s trading
                      positions before the time that the trading strategies would
                      otherwise dictate
                      liquidation.
 
 The
                      failure or bankruptcy of a clearing broker could result in
                      a substantial loss of
                      US12OF’s assets.
 
 Under
                      CFTC regulations, a clearing broker maintains customers’ assets in a bulk
                      segregated account. If a clearing broker fails to do so, or
                      is unable to satisfy
                      a substantial deficit in a customer account, its other customers
                      may be subject
                      to risk of a substantial loss of their funds in the event of
                      that clearing
                      broker’s bankruptcy. In that event, the clearing broker’s customers, such as
                      US12OF, are entitled to recover, even in respect of property
                      specifically
                      traceable to them, only a proportional share of all property
                      available for
                      distribution to all of that clearing broker’s customers. US12OF also may be
                      subject to the risk of the failure of, or delay in performance
                      by, any exchanges
                      and markets and their clearing organizations, if any, on which
                      commodity
                      interest contracts are traded.
  From
                      time
                      to time, the clearing brokers may be subject to legal or regulatory
                      proceedings
                      in the ordinary course of their business. A clearing broker’s involvement in
                      costly or time-consuming legal proceedings may divert financial
                      resources or
                      personnel away from the clearing broker’s trading operations, which could impair
                      the clearing broker’s ability to successfully execute and clear US12OF’s
                      trades.
 
 Third
                      parties may infringe upon or otherwise violate intellectual
                      property rights or
                      assert that the General Partner has infringed or otherwise
                      violated their
                      intellectual property rights, which may result in significant
                      costs and diverted
                      attention.
 
 Third
                      parties may utilize US12OF’s intellectual property or technology, including the
                      use of its business methods, trademarks and trading program
                      software, without
                      permission. The General Partner has a patent pending for US12OF’s business
                      method and it is registering its trademarks. US12OF does not
                      currently have any
                      proprietary software. However, if it obtains proprietary software
                      in the future,
                      then any unauthorized use of US12OF’s proprietary software and other technology
                      could also adversely affect its competitive advantage. US12OF
                      may have
                      difficulty monitoring unauthorized uses of its patents, trademarks,
                      proprietary
                      software and other technology. Also, third parties may independently
                      develop
                      business methods, trademarks or proprietary software and other
                      technology
                      similar to that of the General Partner or claim that the General
                      Partner has
                      violated their intellectual property rights, including their
                      copyrights,
                      trademark rights, trade names, trade secrets and patent rights.
                      As a result, the
                      General Partner may have to litigate in the future to protect
                      its trade secrets,
                      determine the validity and scope of other parties’ proprietary rights, defend
                      itself against claims that it has infringed or otherwise violated
                      other parties’
rights, or defend itself against claims that its rights are
                      invalid. Any
                      litigation of this type, even if the General Partner is successful
                      and
                      regardless of the merits, may result in significant costs,
                      divert its resources
                      from US12OF, or require it to change its proprietary software
                      and other
                      technology or enter into royalty or licensing agreements. See
“Legal Risks”
below.
  43
 The
          success of US12OF depends on the ability of the General Partner to accurately
          implement trading systems, and any failure to do so could subject US12OF
          to
          losses on such transactions.
 
 The
          General Partner anticipates using mathematical formulas built into a generally
          available spreadsheet program to decide whether it should buy or sell Crude
          Oil
          Interests each day. Specifically, the General Partner anticipates using
          the
          spreadsheet to make mathematical calculations and to monitor positions
          in Crude
          Oil Interests and Treasuries and correlations to the Benchmark Futures
          Contracts. The General Partner must accurately process the spreadsheets’ outputs
          and execute the transactions called for by the formulas. In addition, US12OF
          relies on the General Partner to properly operate and maintain its computer
          and
          communications systems. Execution of the formulas and operation of the
          systems
          are subject to human error. Any failure, inaccuracy or delay in implementing
          any
          of the formulas or systems and executing US12OF’s transactions could impair its
          ability to achieve US12OF’s investment objective. It could also result in
          decisions to undertake transactions based on inaccurate or incomplete
          information. This could cause substantial losses on transactions.
 
 US12OF
          may experience substantial losses on transactions if the computer or
          communications system fails.
 
 US12OF’s
          trading activities, including its risk management, depend on the integrity
          and
          performance of the computer and communications systems supporting them.
          Extraordinary transaction volume, hardware or software failure, power or
          telecommunications failure, a natural disaster or other catastrophe could
          cause
          the computer systems to operate at an unacceptably slow speed or even fail.
          Any
          significant degradation or failure of the systems that the General Partner
          uses
          to gather and analyze information, enter orders, process data, monitor
          risk
          levels and otherwise engage in trading activities may result in substantial
          losses on transactions, liability to other parties, lost profit opportunities,
          damages to the General Partner’s and US12OF’s reputations, increased operational
          expenses and diversion of technical resources.
 
 If
          the computer and communications systems are not upgraded, US12OF’s financial
          condition could be harmed.
 
 The
          development of complex computer and communications systems and new technologies
          may render the existing computer and communications systems supporting
          US12OF’s
          trading activities obsolete. In addition, these computer and communications
          systems must be compatible with those of third parties, such as the systems
          of
          exchanges, clearing brokers and the executing brokers. As a result, if
          these
          third parties upgrade their systems, the General Partner will need to make
          corresponding upgrades to continue effectively its trading activities.
          US12OF’s
          future success will depend on US12OF’s ability to respond to changing
          technologies on a timely and cost-effective basis.
 
 US12OF
          depends on the reliable performance of the computer and communications
          systems
          of third parties, such as brokers and futures exchanges, and may experience
          substantial losses on transactions if they fail.
 
 US12OF
          depends on the proper and timely function of complex computer and communications
          systems maintained and operated by the futures exchanges, brokers and other
          data
          providers that the General Partner uses to conduct trading activities.
          Failure
          or inadequate performance of any of these systems could adversely affect
          the
          General Partner’s ability to complete transactions, including its ability to
          close out positions, and result in lost profit opportunities and significant
          losses on commodity interest transactions. This could have a material adverse
          effect on revenues and materially reduce US12OF’s available capital. For
          example, unavailability of price quotations from third parties may make
          it
          difficult or impossible for the General Partner to use its proprietary
          software
          that it relies upon to conduct its trading activities. Unavailability of
          records
          from brokerage firms may make it difficult or impossible for the General
          Partner
          to accurately determine which transactions have been executed or the details,
          including price and time, of any transaction executed. This unavailability
          of
          information also may make it difficult or impossible for the General Partner
          to
          reconcile its records of transactions with those of another party or to
          accomplish settlement of executed transactions.
 
 The
          occurrence of a terrorist attack, or the outbreak, continuation or expansion
          of
          war or other hostilities could disrupt US12OF’s trading activity and materially
          affect US12OF’s profitability.
 
 The
          operations of US12OF, the exchanges, brokers and counterparties with which
          US12OF does business, and the markets in which US12OF does business could
          be
          severely disrupted in the event of a major terrorist attack or the outbreak,
          continuation or expansion of war or other hostilities. The terrorist attacks
          of
          September 11, 2001 and the war in Iraq, global anti-terrorism initiatives
          and
          political unrest in the Middle East and Southeast Asia continue to fuel
          this
          concern.
 44
 Risk
              of Leverage and Volatility
 
 If
              the General Partner permits US12OF to become leveraged, an investor
              could lose
              all or substantially all of its investment if US12OF’s trading positions
              suddenly turn unprofitable.
 
 Commodity
              pools’ trading positions in futures contracts or other commodity interests
              are
              typically required to be secured by the deposit of margin funds that
              represent
              only a small percentage of a futures contract’s (or other commodity interests’)
              entire face value. This feature permits commodity pools to “leverage” their
              assets by purchasing or selling futures contracts (or other commodity
              interests)
              with an aggregate value in excess of the commodity pool’s assets. While this
              leverage can increase the pool’s profits, relatively small adverse movements in
              the price of the pool’s futures contracts can cause significant losses to the
              pool. While the General Partner does not currently intend to leverage
              US12OF’s
              assets, it is not prohibited from doing so under the LP Agreement or
              otherwise.
 
 The
              price of crude oil is volatile which could cause large fluctuations
              in the price
              of units.
  Movements
              in the price of crude oil may be the result of factors outside of the
              General
              Partner’s control and may not be anticipated by the General Partner. Among
              the
              factors that can cause volatility in the price of crude oil are:
 
 •
                    worldwide
                        or regional demand for energy, which is affected by economic
                        conditions;
 •
                    the
                        domestic and foreign supply and inventories of oil and
                        gas;
 •
                    weather
                        conditions, including abnormally mild winter or summer weather,
                        and
                        abnormally harsh winter or summer
                        weather;
 •
                    availability
                        and adequacy of pipeline and other transportation
                        facilities;
 •
                    domestic
                        and foreign governmental regulations and
                        taxes;
 •
                    political
                        conditions in gas or oil producing
                        regions;
 •
                    the
                        ability of members of the Organization of Petroleum Exporting
                        Countries
                        (“OPEC”) to agree upon and maintain oil prices and production
                        levels;
 •
                    the
                        price and availability of alternative fuels; and•
                    the
                        impact of energy conservation
                        efforts.
 
 45
 The
              impact of environmental and other governmental laws and regulations
              that may
              affect the price of crude oil.
 
 Environmental
              and other governmental laws and regulations have increased the costs
              to plan,
              design, drill, install, operate and abandon crude oil and oil wells.
              Other laws
              have prevented exploration and drilling of crude oil in certain environmentally
              sensitive federal lands and waters. Several environmental laws that
              have a
              direct or an indirect impact on the price of crude oil include, but
              are not
              limited to, the Clean Air Act, Clean Water Act, Resource Conservation
              and
              Recovery Act, and the Comprehensive Environmental Response, Compensation
              and
              Liability Act of 1980.
 
 The
              limited method for transporting and storing crude oil may cause the
              price of
              crude oil to increase.
 
 Crude
              oil
              is primarily transported and stored throughout the United States by
              way of
              pipeline and underground storage facilities. These systems may not
              be adequate
              to meet demand, especially in times of peak demand or in areas of the
              United
              States where gas service is already limited due to minimal pipeline
              and storage
              infrastructure. As a result of the limited method for transporting
              and storing
              crude oil, the price of crude oil may increase.
 
 Over-the-Counter
              Contract Risk
 
 Over-the-counter
              transactions are subject to little, if any, regulation.
 
 A
              portion
              of US12OF’s assets may be used to trade over-the-counter crude oil interest
              contracts, such as forward contracts or swap or spot contracts. Over-the-counter
              contracts are typically traded on a principal-to-principal basis through
              dealer
              markets that are dominated by major money center and investment banks
              and other
              institutions and are essentially unregulated by the CFTC. An investor
              therefore
              does not receive the protection of CFTC regulation or the statutory
              scheme of
              the CEA in connection with this trading activity by US12OF. The markets
              for
              over-the-counter contracts rely upon the integrity of market participants
              in
              lieu of the additional regulation imposed by the CFTC on participants
              in the
              futures markets. The lack of regulation in these markets could expose
              US12OF in
              certain circumstances to significant losses in the event of trading
              abuses or
              financial failure by participants.
 
 US12OF
              will be subject to credit risk with respect to counterparties to
              over-the-counter contracts entered into by US12OF or held by special
              purpose or
              structured vehicles.
 
 US12OF
              also faces the risk of non-performance by the counterparties to the
              over-the-counter contracts. Unlike in futures contracts, the counterparty
              to
              these contracts is generally a single bank or other financial institution,
              rather than a clearing organization backed by a group of financial
              institutions.
              As a result, there will be greater counterparty credit risk in these
              transactions. A counterparty may not be able to meet its obligations
              to US12OF,
              in which case US12OF could suffer significant losses on these
              contracts.
 
 If
              a
              counterparty becomes bankrupt or otherwise fails to perform its obligations
              due
              to financial difficulties, US12OF may experience significant delays
              in obtaining
              any recovery in a bankruptcy or other reorganization proceeding. US12OF
              may
              obtain only limited recovery or may obtain no recovery in such
              circumstances.
 
 US12OF
              may be subject to liquidity risk with respect to its over-the-counter
              contracts.
 
 Over-the-counter
              contracts have terms that make them less marketable than Futures Contracts.
              Over-the-counter contracts are less marketable because they are not
              traded on an
              exchange, do not have uniform terms and conditions, and are entered
              into based
              upon the creditworthiness of the parties and the availability of credit
              support,
              such as collateral, and in general, they are not transferable without
              the
              consent of the counterparty. These conditions diminish the ability
              to realize
              the full value of such contracts.
 
 46
 Risk
              of Trading in International Markets
 
 Trading
              in international markets would expose US12OF to credit and regulatory
              risk.
 
 The
              General Partner expects to invest primarily in Futures Contracts, a
              significant
              portion of which will be on United States exchanges including the NYMEX.
              However, a portion of US12OF’s trades may take place on markets and exchanges
              outside the United States. Some non-U.S. markets present risks because
              they are
              not subject to the same degree of regulation as their U.S. counterparts.
              None of
              the CFTC, NFA, or any domestic exchange regulates activities of any
              foreign
              boards of trade or exchanges, including the execution, delivery and
              clearing of
              transactions, nor has the power to compel enforcement of the rules
              of a foreign
              board of trade or exchange or of any applicable non-U.S. laws. Similarly,
              the
              rights of market participants, such as US12OF, in the event of the
              insolvency or
              bankruptcy of a non-U.S. market or broker are also likely to be more
              limited
              than in the case of U.S. markets or brokers. As a result, in these
              markets,
              US12OF has less legal and regulatory protection than it does when it
              trades
              domestically.
 
 In
              some
              of these non-U.S. markets, the performance on a contract is the responsibility
              of the counterparty and is not backed by an exchange or clearing corporation
              and
              therefore exposes US12OF to credit risk. Trading in non-U.S. markets
              also leaves
              US12OF susceptible to swings in the value of the local currency against
              the U.S.
              dollar. Additionally, trading on non-U.S. exchanges is subject to the
              risks
              presented by exchange controls, expropriation, increased tax burdens
              and
              exposure to local economic declines and political instability. An adverse
              development with respect to any of these variables could reduce the
              profit or
              increase the loss earned on trades in the affected international
              markets.
 
 International
              trading activities subject US12OF to foreign exchange risk.
 
 The
              price
              of any non-U.S. Futures Contract, option on any non-U.S. Futures Contract
              or
              other non-U.S. crude oil-related investment, and, therefore, the potential
              profit and loss on such Crude Oil Interests, may be affected by any
              variance in
              the foreign exchange rate between the time the order is placed and
              the time it
              is liquidated, offset or exercised. As a result, changes in the value
              of the
              local currency relative to the U.S. dollar may cause losses to US12OF
              even if
              the contract traded is profitable.
 
 US12OF’s
              international trading could expose it to losses resulting from non-U.S.
              exchanges that are less developed or less reliable than United States
              exchanges.
 
 Some
              non-U.S. exchanges also may be in a more developmental stage so that
              prior price
              histories may not be indicative of current price dynamics. In addition,
              US12OF
              may not have the same access to certain positions on foreign trading
              exchanges
              as do local traders, and the historical market data on which the General
              Partner
              bases its strategies may not be as reliable or accessible as it is
              for U.S.
              exchanges.
 
 47
 Tax
              Risk
 
 An
              investor’s tax liability may exceed the amount of distributions, if any, on
              its units.
 
 Cash
              or
              property will be distributed at the sole discretion of the General
              Partner, and
              the General Partner currently does not intend to make cash or other
              distributions with respect to units. Investors will be required to
              pay U.S.
              federal income tax and, in some cases, state, local, or foreign income
              tax, on
              their allocable share of US12OF’s taxable income, without regard to whether they
              receive distributions or the amount of any distributions. Therefore,
              investors’
tax liability with respect to their units may exceed the amount of
              cash or value
              of property (if any) distributed.
 
 An
              investor’s allocable share of taxable income or loss may differ from its
              economic income or loss on its units.
 
 Due
              to
              the application of the assumptions and conventions applied by US12OF
              in making
              allocations for tax purposes and other factors, an investor’s allocable share of
              US12OF’s income, gain, deduction or loss may be different than its economic
              profit or loss from its units for a taxable year. This difference could
              be
              temporary or permanent and, if permanent, could result in an investor
              being
              taxed on amounts in excess of its economic income.
 
 Items
              of income, gain, deduction, loss and credit with respect to units could
              be
              reallocated if the IRS does not accept the assumptions and conventions
              applied
              by US12OF in allocating those items, with potential adverse consequences
              for an
              investor.
 
 The
              U.S.
              tax rules pertaining to partnerships are complex and their application
              to large,
              publicly traded partnerships such as US12OF is in many respects uncertain.
              US12OF will apply certain assumptions and conventions
              in an attempt to comply with the intent of the applicable rules and
              to report
              taxable income, gains, deductions, losses and credits in a manner that
              properly
              reflects unitholders’ economic gains and losses. These assumptions and
              conventions may not fully comply with all aspects of the Internal Revenue
              Code
              (the “Code”) and applicable Treasury Regulations, however, and it is possible
              that the U.S. Internal Revenue Service will successfully challenge
              our
              allocation methods and require us to reallocate items of income, gain,
              deduction, loss or credit in a manner that adversely affects an investor.
              If
              this occurs, an investor may be required to file an amended tax return
              and to
              pay additional taxes plus deficiency interest.
 
 US12OF
              could be treated as a corporation for federal income tax purposes,
              which may
              substantially reduce the value of an investor’s units.
 
 US12OF
              has received an opinion of counsel that, under current U.S. federal
              income tax
              laws, US12OF will be treated as a partnership that is not taxable as
              a
              corporation for U.S. federal income tax purposes, provided that (i)
              at least 90
              percent of US12OF’s annual gross income consists of “qualifying income” as
              defined in the Code, (ii) US12OF is organized and operated in accordance
              with
              its governing agreements and applicable law and (iii) US12OF does not
              elect to
              be taxed as a corporation for federal income tax purposes. Although
              the General
              Partner anticipates that US12OF will satisfy the “qualifying income” requirement
              for all of its taxable years, that result cannot be assured. US12OF
              has not
              requested and will not request any ruling from the IRS with respect
              to its
              classification as a partnership not taxable as a corporation for federal
              income
              tax purposes. If the IRS were to successfully assert that US12OF is
              taxable as a
              corporation for federal income tax purposes in any taxable year, rather
              than
              passing through its income, gains, losses and deductions proportionately
              to
              unitholders, US12OF would be subject to tax on its net income for the
              year at
              corporate tax rates. In addition, although the General Partner does
              not
              currently intend to make distributions with respect to units, any distributions
              would be taxable to unitholders as dividend income. Taxation of US12OF
              as a
              corporation could materially reduce the after-tax return on an investment
              in
              units and could substantially reduce the value of an investor’s
              units.
 
 48
 Legal
            Risks
 
 Others
            may notify US12OF of intellectual property rights that could adversely
            impact
            US12OF.
  Goldman,
              Sachs & Co. (“Goldman Sachs”) sent USOF a letter on March 17, 2006,
              providing USOF and the General Partner notice under 35 U.S.C. Section
              154(d) of
              two pending United States patent applications, Publication Nos. 2004/0225593A1
              and 2006/0036533A1. Both patent applications are generally directed
              to a method
              and system for creating and administering a publicly traded interest
              in a
              commodity pool. In particular, the Abstract of each patent application
              defines a
              means for creating and administering a publicly traded interest in
              a commodity
              pool that includes the steps of forming a commodity pool having a first
              position
              in a futures contract and a corresponding second position in a margin
              investment, and issuing equity interests of the commodity pool to third
              party
              investors. Subsequently, two U.S. Patents were issued; the first, patent
              number
              US7,283,978B2, was issued on October 16, 2007, and the second, patent
              number
              US7,319,984B2, was issued on January 15, 2008.
 
 Preliminarily,
              USOF's management is of the view that the structure and operations of USOF
              and its affiliated commodity pools do not infringe these patents. USOF
              is also
              in the process of reviewing prior art (prior structures and operations
              of
              similar investment vehicles) that may invalidate one or more of the
              claims in
              these patents. In addition, USOF has retained patent counsel to advise
              it on
              these matters and is in the process of obtaining their opinions regarding
              the
              non-infringement of each of these patents by USOF and/or the patents'
              invalidity
              based on prior art. If the patents were alleged to apply to USOF's
              structure
              and/or operations, and are found by a court to be valid and infringed,
              Goldman
              Sachs may be awarded significant monetary damages and/or injunctive
              relief. See
              “US12OF's Operating Risks — Third parties may infringe upon or
              otherwise violate intellectual property rights or assert that the General
              Partner has infringed or otherwise violated their intellectual property
              rights,
              which may result in significant costs and diverted
              attention.”
 Item 1B.
                Unresolved
                    Staff
                    Comments.
 
 Not
          applicable.
 
 Item 2.
                Properties.
 
 Not
          applicable.
 49
 Item 3.
                Legal
                    Proceedings.
  Although US12OF
          may, from time to time, be involved in litigation arising out of its operations
          in the normal course
          of
          business or otherwise, it is currently not a party to any pending material
          legal
          proceedings, except for the items noted below.
 Goldman,
            Sachs
& Co.
  Goldman
                Sachs sent USOF a letter on March 17, 2006, providing USOF and the
                General
                Partner notice under 35 U.S.C. Section 154(d) of two pending United
                States
                patent applications, Publication Nos. 2004/0225593A1 and 2006/0036533A1.
                Both
                patent applications are generally directed to a method and system
                for creating
                and administering a publicly traded interest in a commodity pool.
                In particular,
                the Abstract of each patent application defines a means for creating
                and
                administering a publicly traded interest in a commodity pool that
                includes the
                steps of forming a commodity pool having a first position in a futures
                contract
                and a corresponding second position in a margin investment, and issuing
                equity
                interests of the commodity pool to third party investors. Subsequently,
                two U.S.
                Patents were issued; the first, patent number US7,283,978B2, was
                issued on
                October 16, 2007, and the second, patent number US7,319,984B2, was
                issued on
                January 15, 2008.
 
 Preliminarily,
                USOF's management is of the view that the structure and operations
                of USOF and
                its affiliated commodity pools do not infringe these patents. USOF
                is also in
                the process of reviewing prior art (prior structures and operations
                of similar
                investment vehicles) that may invalidate one or more of the claims
                in these
                patents. In addition, USOF has retained patent counsel to advise
                it on these
                matters and is in the process of obtaining their opinions regarding
                the
                non-infringement of each of these patents by USOF and/or the patents'
                invalidity
                based on prior art. If the patents were alleged to apply to USOF's
                structure
                and/or operations, and are found by a court to be valid and infringed,
                Goldman
                Sachs may be awarded significant monetary damages and/or injunctive
                relief. See
                “US12OF's Operating Risks — Third parties may infringe upon or
                otherwise violate intellectual property rights or assert that the
                General
                Partner has infringed or otherwise violated their intellectual property
                rights,
                which may result in significant costs and diverted
                attention.”
 50
  Item 4.
                  Submission
                      of Matters to a Vote
                      of Security Holders.
 
 Not
            applicable.
  Part
              II
 
 Item 5.
                    Market
                        for Registrant’s Common
                        Equity, Related Stockholder Matters and Issuer Purchases
                        of Equity
                        Securities.
  Price
                Range of
                Units
  US12OF’s
                units have traded on the AMEX under the symbol “USL” since its initial public
                offering on December 6, 2007. The following table sets forth the
                range of
                reported high and low sales prices of the units as reported on AMEX
                for the
                period of December 6, 2007 through December 31, 2007.
  High
                      
                      LowFiscal
                          year 2007Fourth
                          quarter (beginning December 6, 2007)
                      
                      $
                      54.37
                      
                      $
                      50.30
  As
                of December 31, 2007, US12OF had 35 holders
                of units.
 D ividends
 US12OF
            has not made and does not intend to make cash distributions to its unitholders.
 
 Issuer
            Purchases of Equity
            Securities
  US12OF
            does not purchase units directly from its unitholders; however, in connection
            with its redemption of baskets held by Authorized Purchasers, US12OF
            did not
            redeem any baskets during the period of December 6, 2007 to December 31,
            2007.
 Item 6.
                Selected
                    Financial
                    Data.
 
 Financial
          Highlights (for the period
          from December 6, 2007 to December 31, 2007)
 (Dollar
          amounts in 000’s except for
          Income per unit)
  Total
                      assets
                  
                  $
                  21,691Net
                      realized and unrealized gains on futures transactions, inclusive
                      of
                      commissions
                  
                  $
                  1,524Net
                      income
                  
                  $
                  1,564Weighted-average
                      limited partnership units
                  
                  
                  400,000Net
                    income per unit
                  
                  $
                  4.23Net
                      income per weighted average unit
                  
                  $
                  3.98Cash
                      at end of year
                  
                  $
                  18,174
 51
 Item 7.
                Management’s
                    Discussion and
                    Analysis of Financial Condition and Results of
                    Operations.
  The
          following discussion should be read in conjunction with the consolidated
          financial statements and the notes thereto of US12OF included elsewhere
          in this
          annual report on Form 10-K.
 
 Forward-Looking
            Information
  This
            annual report on Form 10-K, including this "Management's Discussion and
            Analysis
            of Financial Condition and Results of Operations," contains forward-looking
            statements regarding the plans and objectives of management for future
            operations. This information may involve known and unknown risks, uncertainties
            and other factors that may cause US12OF's actual results, performance
            or
            achievements to be materially different from future results, performance
            or
            achievements expressed or implied by any forward-looking statements.
            Forward-looking statements, which involve assumptions and describe US12OF's
            future plans, strategies and expectations, are generally identifiable
            by use of
            the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,”
“believe,” “intend” or “project,” the negative of these words, other
            variations on these words or comparable terminology. These forward-looking
            statements are based on assumptions that may be incorrect, and US12OF
            cannot
            assure investors that these projections included in these forward-looking
            statements will come to pass. US12OF's actual results could differ
            materially from those expressed or implied by the forward-looking statements
            as
            a result of various factors.
  US12OF
            was based the forward-looking statements included in this annual report
            on Form
            10-K on information available to it on the date of this annual report on
            Form 10-K, and US12OF assumes no obligation to update any such
            forward-looking statements. Although US12OF undertakes no obligation
            to revise
            or update any forward-looking statements, whether as a result of new
            information, future events or otherwise, investors are advised to consult
            any
            additional disclosures that US12OF may make directly to them or through
            reports that US12OF in the future files with the SEC, including annual
            reports on Form 10-K, quarterly reports on Form 10-Q and current reports
            on Form
            8-K.
 Introduction
 
 US12OF,
              a
              Delaware limited partnership, is a commodity pool that issues units that
              may be purchased and sold on the AMEX. The
              net
              assets of US12OF consist primarily of investments in futures contracts
              for
              light, sweet crude oil, other types of crude oil, heating oil, gasoline,
              natural
              gas, and other petroleum-based fuels that are traded on the NYMEX,
              ICE Futures
              or other U.S. and foreign exchanges (collectively, “Futures Contracts”). This
              includes contracts that are of the standard industry size as measured
              in
              physical amounts of crude oil, as well as similar contracts that are
              financially
              settled but are based on a percentage of the standard size contracts.
              US12OF may
              also invest in other crude oil-related investments such as cash-settled
              options
              on Futures Contracts, forward contracts for crude oil, and over-the-counter
              transactions that are based on the price of crude oil, heating oil,
              gasoline,
              natural gas, and other petroleum-based fuels, Futures Contracts and
              indices
              based on the foregoing (collectively, “Other Crude Oil-Related Investments”).
              For convenience and unless otherwise specified, Futures Contracts and
              Other
              Crude Oil-Related Investments collectively are referred to as “Crude Oil
              Interests” in this annual report on Form 10-K. 
 US12OF
                invests in Crude Oil Interests to the fullest extent possible without
                being
                leveraged or unable to satisfy its current or potential margin or
                collateral
                obligations with respect to its investments in Futures Contracts
                and Other Crude
                Oil-Related Investments. The primary focus of the General Partner
                is the
                investment in Futures Contracts and the management of its investments
                in Treasuries, cash and/or cash equivalents for margining purposes and
                as
                collateral.
 
 The
                investment objective of US12OF is to have the changes in percentage
                terms of the
                units’ net asset value reflect the changes in percentage terms of the price
                of
                light, sweet crude oil delivered to Cushing, Oklahoma, as measured
                by the
                changes in the average of the prices of the Benchmark Futures Contracts,
                consisting of 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 measured by the futures contracts that are the next month
                contract to
                expire and the contracts for the following 11 consecutive months,
                less US12OF’s
                expenses. When calculating the daily movement of the average price
                of the 12
                contracts, each contract month will be equally weighted.
 The General
                Partner is registered as a CPO with the CFTC and is authorized by
                the LP
                Agreement to manage US12OF. The General Partner is authorized by
                US12OF in its
                sole judgment to employ, establish the terms of employment for and
                terminate
                commodity trading advisors or futures commission merchants.
  In
                  December of 2007, US12OF initially registered 11,000,000 units
                  on Form S-1 with
                  the SEC.  On December 6, 2007, US12OF listed its units on the AMEX
                  under the ticker symbol “USL”. On that day, US12OF established its initial net
                  asset value by setting a price per unit at $50.00 and issued 300,000
                  units to
                  the initial Authorized Purchaser, Merrill Lynch Professional Clearing
                  Corp., in
                  exchange for $15,000,000 in cash.  To date, US12OF has registered a
                  total of 11,000,000 units.  US12OF also purchased Futures Contracts
                  traded on the NYMEX based on light, sweet crude oil in connection
                  with the units
                  sold to the initial Authorized Purchaser.
 52
 Valuation
            of Futures Contracts
            and the Computation of the NAV
 The
              NAV
              of US12OF units is calculated once each trading day as of the earlier
              of the
              close of the NYSE or 4:00 p.m.
              New York time. The NAV for a particular trading day is released after
              4:15 p.m. New York time. Trading
              on the AMEX typically closes at 4:15 p.m. New York time. US12OF uses the
              NYMEX closing price (determined at the earlier of the close of that
              exchange or
              2:30 p.m. New York time) for the contracts held on the NYMEX, but
              calculates or determines the value of all other US12OF investments,
              including
              ICE Futures or other futures contracts, as of the earlier of the close
              of the NYSE or 4:00 p.m. New York time.
  Management’s
              Discussion of Results of
              Operation and the Crude Oil Market
 
 Results
              of
              Operations.  On
              December 6, 2007, US12OF listed its units on the AMEX under the ticker
              symbol
“USL.” On that day US12OF established its initial offering price at $50.00
              per
              unit and issued 300,000 units to the initial Authorized Purchaser,
              Merrill Lynch
              Professional Clearing Corp., in exchange for $15,000,000 in cash. As
              of December
              31, 2007, US12OF had issued 400,000 units, 400,000 of which were
              outstanding.
  As
              of
              December 31, 2007, the total unrealized gain on crude oil Futures Contracts
              owned or held on that day was $1,525,370 and US12OF established cash
              deposits that were equal to $20,173,384. The majority of those cash
              assets were
              held in overnight deposits at US12OF’s Custodian, while less
              than
              10%of the cash balance was held as margin deposits with
              the
              futures commission merchant for the Futures Contracts purchased. The ending
              per unit NAV on December 31, 2007 was $54.23.
 
 Portfolio
              Expenses .
              US12OF’s expenses consist of investment management fees, brokerage fees and
              commissions, certain offering costs, licensing fees and the fees and
              expenses of
              the independent directors of the General Partner. US12OF pays the
              General Partner a management fee of 0.60% of NAV on all of its net
              assets.
  US12OF pays
                for all brokerage fees, taxes and other expenses, including licensing
                fees for
                the use of intellectual property, ongoing registration or other fees
                paid to the
                SEC, FINRA and any other regulatory agency in connection
                with offers and sales of its units subsequent to the initial offering
                and
                all legal, accounting, printing and other expenses associated
                therewith. For the period ended December 31, 2007,
                US12OF incurred $0 in ongoing registration fees and other offering
                expenses. US12OF is responsible for paying the fees and expenses,
                including
                directors' and officers' liability insurance, of the independent
                directors of
                the General Partner who are also audit committee
                members. US12OF shares these fees with USOF and USNG based on the
                relative assets of each fund computed on a daily basis. These fees
                for calendar
                year 2007 amounted to a total of $286,000 for all three
                funds.
  US12OF
              also incurs commissions to brokers for the purchase and sale of Futures
              Contracts, Other Crude Oil Related Investments or Treasuries. During 2007,
              total commissions paid amounted to $892. Prior to the initial offering
              of its
              units, US12OF had estimated that its annual level of such commissions was
              expected to be 0.13% of total net assets. As an annualized percentage
              of total
              net assets, the figure for 2007 represents approximately 0.06% of total net
              assets. However, there can be no assurance that commission costs and
              portfolio
              turnover will not cause commission expenses to rise in future
              quarters.
 Interest
                Income .
Unlike
                some alternative investment funds, US12OF does not borrow money in
                order to
                obtain leverage, so US12OF does not incur any interest
                expense.  Rather, US12OF’s margin deposits are maintained in
                Treasuries and cash and interest is earned on 100% of US12OF’s available assets,
                which include unrealized profits credited to US12OF’s
                accounts.
 53
 Tracking
              US12OF’s
              Benchmark .
              US12OF
              seeks to manage its portfolio such that changes in its average daily
              NAV, on a
              percentage basis, closely track changes in the average of the daily
              prices of
              the Benchmark Futures Contracts, also on a percentage basis. Specifically,
              US12OF seeks to manage the portfolio such that over any rolling period
              of 30
              valuation days, the average daily change in the NAV is within a range
              of 90% to
              110% (0.9 to 1.1), of the average daily change of the Benchmark Futures
              Contracts. As an example, if the average daily movement of the average of
              the prices of the Benchmark Futures Contracts for a particular 30-day time
              period was 0.5% per day, US12OF management would attempt to manage
              the portfolio
              such that the average daily movement of the NAV during that same time
              period
              fell between 0.45% and 0.55% ( i.e .,
              between 0.9 and 1.1 of the benchmark’s results). US12OF’s portfolio management
              goals do not include trying to make the nominal price of US12OF’s NAV equal to
              the average of the nominal prices of the current Benchmark Futures
              Contracts or the spot price for crude oil. Management believes that
              it is not
              practical to manage the portfolio to achieve such an investment goal
              when
              investing in listed crude oil Futures Contracts.
 Since
                US12OF commenced operations in December of 2007, it did not have
                30 valuation
                days from its inception date to December 31, 2007. However, since
                inception, the
                simple average daily change in the Benchmark Futures Contracts was 0.480%,
                while the simple average daily change in the NAV of US12OF over the
                same time
                period was 0.489%. The average daily difference was 0.009% (or 0.9
                basis points,
                where 1 basis point equals 1/100 of 1%). As a percentage of the daily
                movement
                of the Benchmark Futures Contracts, the average error in daily tracking by
                the NAV was 2.65%, meaning that over this time period US12OF’s tracking error
                was within the plus or minus 10% range established as its benchmark
                tracking
                goal.
  Daily
                    Movement in
                    Percentage terms of US12OF's NAV versus the Benchmark
                    Contracts
 (since
                  inception12/5/07to12/31/07)Daily Movement
  Since
                  the
                  offering of US12OF units to the public on December 6, 2007 to December 31,
                  2007, the simple average daily change in the Benchmark Futures Contracts
                  was 0.489%, while the simple average daily change in the NAV of
                  US12OF over the
                  same time period was 0.480%. The average daily difference was 0.009%
                  (or 0.9
                  basis point, where 1 basis point equals 1/100 of 1%). As a percentage
                  of the
                  daily movement of the Benchmark Futures Contracts, the average error in
                  daily tracking by the NAV was 2.65%, meaning that over this time
                  period US12OF’s
                  tracking error was within the plus or minus 10% range established
                  as its
                  benchmark tracking goal.
 
 There
                  are
                  currently three factors that have impacted, during the latest period,
                  or are
                  most likely to impact, US12OF’s ability to accurately track its
                  Benchmark Futures Contracts.
 
 First,
                  US12OF may buy or sell its holdings in the then current Benchmark
                  Futures
                  Contracts at a price other than the closing settlement price of
                  that contract on
                  the day in which US12OF executes the trade. In that case, US12OF
                  may get a price
                  that is higher, or lower, than that of the Benchmark Futures Contracts,
                  which, could cause the changes in the daily NAV of US12OF to either be
                  too
                  high or too low relative to the changes in the daily benchmark.
                  In 2007,
                  management attempted to minimize the effect of these transactions
                  by seeking to
                  execute its purchase or sales of the Benchmark Futures Contracts at, or as
                  close as possible to, the end of the day settlement price. However,
                  it may not
                  always be possible for US12OF to obtain the closing settlement
                  price and there
                  is no assurance that failure to obtain the closing settlement price
                  in the
                  future will not adversely impact US12OF’s attempt to track its benchmark over
                  time.
  Second,
                    US12OF earns interest on its cash, cash equivalents and Treasury
                    holdings. US12OF is not required to distribute any portion of
                    its income to its
                    unitholders and did not make any distribution to unitholders
                    in 2007. Interest
                    payments, and any other income, were retained within the portfolio
                    and added to
                    US12OF’s NAV. When this income exceeds the level of US12OF’s expenses for its
                    management fee, brokerage commissions and other expenses (including
                    ongoing
                    registration fees, licensing fees and the fees and expenses of the
                    independent directors of the General Partner), US12OF will realize
                    a net yield
                    that will tend to cause daily changes in the NAV of US12OF to
                    track slightly
                    higher than daily changes in the average of the prices of
                    the Benchmark Futures Contracts. During 2007, US12OF earned, on an
                    annualized basis, approximately 3.41% on its cash holdings. It
                    also incurred
                    cash expenses on an annualized basis of 0.60% for management
                    fees and
                    approximately 0.06% in brokerage commission costs related to
                    the purchase and
                    sale of futures contracts, and 0.24% for other expenses. The
                    foregoing fees and
                    expenses resulted in a net yield on an annualized basis of approximately
                    2.51%
                    and affected US12OF’s ability to track its benchmark. If short-term interest
                    rates rise above the current levels, the level of deviation created
                    by the yield
                    would increase. Conversely, if short-term interest rates were
                    to decline, the
                    amount of error created by the yield would decrease. If short-term
                    yields drop
                    to a level lower than the combined expenses of the management
                    fee and the
                    brokerage commissions, then the tracking error would become a
                    negative number
                    and would tend to cause the daily returns of the NAV to underperform
                    the daily
                    returns of the Benchmark Futures Contracts.
  Third,
                        US12OF may hold Other Crude Oil Related Investments in its portfolio
                        that
                        may fail to closely track the Benchmark Futures Contracts' total return
                        movements. In that case, the error in tracking the benchmark
                        could result in
                        daily changes in the NAV of US12OF that are either too high,
                        or too low,
                        relative to the daily changes in the benchmark. During the
                        period from December
                        6, 2007 to Decemeber 31, 2007, US12OF did not hold any Other
                        Crude
                        Oil Related Investments. However, there can be no assurance that
                        in future
                        quarters US12OF will not make use of such Other Crude Oil
                        Related
                        Investments.
 During
                            the period from December 6, 2007 to December
                            31, 2007, the average prices of front 12 month contracts rose from near the
                            $88.35 level to approximately the $93.28 level. The prices
                            of front month
                            contracts were also higher than the price of second or
                            third month contracts for
                            most of this time period.


54
 Term
        Structure of Crude Oil Futures
        Prices and the Impact on Total Returns.Several factors determine the
        total return from investing in a futures contract position. One factor that
        impacts the total return that will result from investing in near month
        crude oil Futures Contracts and “rolling” those contracts forward each month is
        the price relationship between the current near month contract and the later
        month contracts. For example, if the price of the near month contract is
        higher
        than the next month contract (a situation referred to as “backwardation” in the
        futures market), then absent any other change there is a tendency for the
        price
        of a next month contract to rise in value as it becomes the near month contract
        and approaches expiration. Conversely, if the price of a near month contract
        is
        lower than the next month contract (a situation referred to as “contango” in the
        futures market), then absent any other change there is a tendency for the
        price
        of a next month contract to decline in value as it becomes the near month
        contract and approaches expiration.
  As
            an
            example, assume that the price of crude oil for immediate delivery (the
“spot”
price), was $50 per barrel, and the value of a position in the near month
            futures contract was also $50. Over time, the price of the barrel of
            crude oil
            will fluctuate based on a number of market factors, including demand for
            oil relative to its supply. The value of the near month contract will
            likewise
            fluctuate in reaction to a number of market factors. If investors seek to
            maintain their holding in a near month contract position and not take
            delivery
            of the oil, every month they must sell their current near month contract
            as it
            approaches expiration and invest in the next month contract.
 
 If
            the
            futures market is in backwardation, e.g., when the expected price of
            oil in the
            future would be less, the investor would be buying a next month contract
            for a
            lower price than the current near month contract. Hypothetically, and
            assuming
            no other changes to either prevailing crude oil prices or the price relationship
            between the spot price, the near month contract and the next month contract
            (and
            ignoring the impact of commission costs and the interest earned on Treasuries,
            cash and/or cash equivalents), the value of the next month contract would
            rise
            as it approaches expiration and becomes the new near month contract.
            In this
            example, the value of the $50 investment would tend to rise faster than
            the spot
            price of crude oil, or fall slower. As a result, it would be possible
            in this
            hypothetical example for the price of spot crude oil to have risen to
            $60 after
            some period of time, while the value of the investment in the futures
            contract
            would have risen to $65, assuming backwardation is large enough or enough
            time
            has elapsed. Similarly, the spot price of crude oil could have fallen
            to $40
            while the value of an investment in the futures contract could have fallen
            to
            only $45. Over time, if backwardation remained constant, the difference
            would
            continue to increase.
 
 If
            the
            futures market is in contango, the investor would be buying a next month
            contract for a higher price than the current near month contract.
            Hypothetically, and assuming no other changes to either prevailing crude
            oil
            prices or the price relationship between the spot price, the near month
            contract
            and the next month contract (and ignoring the impact of commission costs
            and the
            interest earned on cash), the value of the next month contract would
            fall as it
            approaches expiration and becomes the new near month contract. In this
            example,
            it would mean that the value of the $50 investment would tend to rise
            slower
            than the spot price of crude oil, or fall faster. As a result, it would
            be
            possible in this hypothetical example for the spot price of crude oil to
            have risen to $60 after some period of time, while the value of the investment
            in the futures contract will have risen to only $55, assuming contango
            is large
            enough or enough time has elapsed. Similarly, the spot price of crude
            oil could
            have fallen to $45 while the value of an investment in the futures contract
            could have fallen to $40. Over time, if contango remained constant, the
            difference would continue to increase.
  Historically,
            the oil futures markets have experienced periods of contango and
            backwardation, with backwardation being in place more often than contango.
            During the past two years, including 2006 and the first half of 2007,
            these
            markets have experienced contango. However, starting early in the third
            quarter
            of 2007, the crude oil futures market moved into backwardation and remained
            in
            that condition for the rest of the year. The chart below compares the
            price of
            the front month contract to the average price of the first 12 months
            over the
            last 10 years (1998-2007). When the price of the front month contract
            is higher
            than the average price of the front 12 month contracts, the market would
            be
            described as being in backwardation. When the price of the front month
            contract
            is lower than the average price of the front 12 month contracts, the
            market
            would be described as being in contango. Although the prices of the front
            month
            contract and the average price of the front 12 month contracts do tend
            to move
            up or down together, it can be seen that at times the front month prices
            are
            clearly higher than the average price of the 12 month contracts (backwardation),
            and other times they are below the average price of the front 12 month
            contracts
            (contango).
 55
 An
          alternative way to view the same data is to subtract the dollar price of
          the
          front month contract from the average dollar price of the front 12 month
          contracts. If the resulting number is a positive number, then the front
          month
          price is higher than the average price of the front 12 months and the market
          could be described as being in backwardation. If the resulting number is
          a
          negative number, than the front month price is lower than the average price
          of
          the front 12 months and the market could be described as being in contango.
          The
          chart below shows the results from subtracting the front month price from
          the
          average price of the front 12 month contracts for the 10 year period between
          1998 and 2007.
  A
          hypothetical investment in a portfolio that involved owning only the front
          month
          contract would produce a different result than a hypothetical investment
          in a
          portfolio that owned an equal number of each of the front 12 month’s worth of
          contracts. Generally speaking, when the crude oil futures market is in
          backwardation, the front month only portfolio would tend to have a higher
          total
          return than the 12 month portfolio. Conversely, if the crude oil futures
          market
          was in contango, the portfolio containing 12 months worth of contracts
          would
          tend to outperform the front month only portfolio. The chart below shows
          the
          hypothetical results of owning a portfolio consisting of the front month
          contract versus a portfolio containing the front 12 month’s worth of contracts.
          In this example, each month the front month only portfolio would sell the
          front
          month contract at expiration and buy the next month out contract. The portfolio
          holding an equal number of the front 12 month’s worth of contracts would sell
          the front month contract at expiration and replace it with the contract
          that
          becomes the new twelfth month contract.
 As
            seen
            in the chart, there have been periods of both positive and negative annual
            total
            returns for both hypothetical portfolios over the last 10 years. In addition,
            there have been periods during which the front month only approach had
            higher
            returns, and periods where the 12 month approach had higher total
            returns.
 56
 The
            General Partner believes that holding futures contracts whose expiration
            dates
            are spread out over a 12 month period of time will cause the total return
            of
            such a portfolio to vary compared to a portfolio that holds only a single
            month’s contract (such as the near month contract).  In particular,
            the General Partner believes that the total return of a portfolio holding
            contracts with a range of expiration months will be impacted differently
            by the
            price relationship between different contract months of the same commodity
            future compared to the total return of a portfolio consisting of the
            near month
            contract.  The General Partner believes that based on historical
            evidence a portfolio that held futures contracts with a range of expiration
            dates spread out over a 12 month period of time would typically be impacted
            less
            by the positive effect of backwardation, and less by the negative effect
            of
            contango, compared to a portfolio that held contracts of a single near
            month. As
            a result, absent the impact of any other factors, a portfolio of 12 different
            monthly contracts would tend to have a lower total return than a near
            month only
            portfolio in a backwardation market and a higher total return in a contango
            market.  However there can be no assurance that such historical
            relationships would provide the same or similar results in the
            future.
 
 Periods
            of backwardation and
            contango do not meaningfully impact US12OF’s investment objective of having
            percentage changes in its per unit NAV track percentage changes in the
            price of
            the Benchmark Futures Contracts sincethe impact of backwardation
            and contango tended to equally impact the percentage changes in price
            of both
            US12OF’s units and the Benchmark Futures Contracts. It is impossible
            to predict with any degree of certainty whether backwardation or contango
            will
            occur in the future. It is likely that both conditions will occur during
            different periods.
  Crude
              Oil Market.During
              the year ended December 31, 2007, crude oil prices were impacted by
              several
              factors. On the consumption side, demand remained strong as continued
              global
              economic growth, especially in emerging economies such as China and
              India,
              remained brisk. Additionally, a falling U.S. dollar, the currency in
              which crude
              oil is traded globally, continued to be weak, effectively making crude
              oil
              cheaper for most non-U.S. dollar economies. On the supply side, production
              remained steady despite concerns about violence impacting production in
              Iraq and Nigeria. At the same time, a concern remains about the ability
              of major
              oil producing countries to continue to raise their production to accommodate
              increasing demand. Additionally, a concern about the strength of the
              U.S.
              economy, and the risk of recession which might lead to the U.S. decreasing
              its
              oil consumption in 2008, began to be a factor in the crude oil markets
              very late
              in 2007.
 Critical
          Accounting
          Policies
 
 Preparation
          of the financial statements and related disclosures in compliance with
          accounting principles generally accepted in the United States of America
          requires the application of appropriate accounting rules and guidance,
          as well
          as the use of estimates. US12OF's application of these policies involves
          judgments and actual results may differ from the estimates used.
  The
          General Partner has evaluated the nature and types of estimates that
          it makes in preparing US12OF's condensed financial statements and related
          disclosures and has determined that the valuation of its investments which
          are not traded on a United States or internationally recognized futures
          exchange
          (such as forward contracts and over-the-counter contracts) involves a critical
          accounting policy. To the extent US12OF makes such investments, the values
          used
          by US12OF for its forward contracts will be provided by its commodity broker
          who
          values over-the-counter contracts based on the present value of estimated
          future cash flows that would be received from or paid to a third party
          in
          settlement of these derivative contracts prior to their delivery date and
          valued
          on a daily basis. In addition, US12OF estimates interest income on a daily
          basis
          using prevailing interest rates earned on its cash and cash equivalents.
          These
          estimates are adjusted to the actual amount received on a monthly basis
          and the
          difference, if any, is not considered material.
  Liquidity
          and Capital
          Resources
 
 US12OF
          has not made, and does not anticipate making, use of borrowings or other
          lines
          of credit to meet its obligations. US12OF has met, and it is anticipated
          that
          US12OF will continue to meet, its liquidity needs in the normal course
          of
          business from the proceeds of the sale of its investments, or from the
          Treasuries, cash and/or cash equivalents that it intends to hold at all
          times.
          US12OF’s liquidity needs include: redeeming units, providing margin deposits for
          its existing oil futures contracts or the purchase of additional crude
          oil
          Futures Contracts and posting collateral for its over-the-counter contracts
          and
          payment of its expenses, summarized below under “Contractual
          Obligations.”
 
 US12OF
          currently generates cash primarily from (i) the sale of Creation Baskets
          and
          (ii) interest earned on Treasuries, cash and/or cash equivalents. US12OF
          has
          allocated substantially all of its net assets to trading in crude oil interests.
          A significant portion of the NAV was held in cash and cash
          equivalents that were used as margin for US12OF's trading in Crude Oil
          Interests. The percentage that Treasuries will bear to the total net assets
          vary from period to period as the market values of the crude oil interests
          change. The balance of the net assets is held in US12OF's Futures Contracts
          and Other Crude Oil Related Investments trading account. Interest earned
          on
          US12OF's interest bearing-funds is paid to US12OF.
 57
 US12OF's
          investment in crude oil interests may be subject to periods of illiquidity
          because of market conditions, regulatory considerations and other reasons.
          For
          example, most commodity exchanges limit the fluctuations in Futures
          Contracts prices during a single day by regulations referred to as “daily
          limits.” During a single day, no trades may be executed at prices beyond the
          daily limit. Once the price of an Futures Contract has increased or
          decreased by an amount equal to the daily limit, positions in the contracts
          can
          neither be taken or liquidated unless the traders are willing to effect
          trades
          at or within the specified daily limit. Such market conditions could prevent
          US12OF from promptly liquidating its positions in Futures Contracts. During
          the period from December 6, 2007 to December 31, 2007, US12OF was not
          forced to purchase or liquidate any of its positions while daily limits
          were in
          effect; however, US12OF cannot predict whether such an event may occur
          in the
          future.
  To
          date,
          all of US12OF's expenses, including its organizational and offering expenses
          relating to the initial offering of its units, have been paid by the General
          Partner. Fees and expenses associated with the registration of units with
          the
          SEC subsequent to the initial offering have been borne by US12OF. In addition,
          fees and expenses (including directors' and officers' liability
          insurance) of the independent directors of the General Partner, the management
          fee paid to the General Partner, brokerage fees and licensing fees will be
          paid directly by US12OF. If the General Partner and US12OF are unsuccessful
          in
          raising sufficient funds to cover US12OF's expenses or in locating any
          other
          source of funding, US12OF will terminate and investors may lose all or
          part of
          their investment.
  Market
          Risk
 
 Trading
          in Futures Contracts and Other Crude Oil Related Investments, such as
          forwards, involves US12OF entering into contractual commitments to purchase
          or sell oil at a specified date in the future. The gross or face amount
          of
          the contracts will significantly exceed US12OF's future cash requirements
          since US12OF intends to close out its open positions prior to settlement.
          As a
          result, US12OF is generally only subject to the risk of loss arising
          from the change in value of the contracts. US12OF considers the "fair value''
          of
          its derivative instruments to be the unrealized gain or loss on the contracts.
          The market risk associated with US12OF's commitments to purchase oil is
          limited
          to the gross face amount of the contacts held. However, should US12OF enter
          into
          a contractual commitment to sell oil, it would be required to make delivery
          of
          the oil at the contract price, repurchase the contract at prevailing prices
          or
          settle in cash. Since there are no limits on the future price of oil, the
          market
          risk to US12OF could be unlimited.
  US12OF's
          exposure to market risk depends on a number of factors, including the
          markets for oil, the volatility of interest rates and foreign exchange
          rates,
          the liquidity of the Futures Contracts and Other Crude Oil Related
          Investments markets and the relationships among the contracts held by US12OF.
          The limited experience that US12OF has in utilizing its model to trade in
          crude oil interests in a manner intended to track the spot price of crude
          oil,
          as well as drastic market occurrences, could ultimately lead to the loss
          of all
          or substantially all of an investor’s capital.
  Credit
          Risk
 
 When
          US12OF enters into Futures Contracts and Other Crude Oil Related
          Investments, it is exposed to the credit risk that the counterparty will
          not be
          able to meet its obligations. The counterparty for the Futures Contracts
          traded on the NYMEX and on most other foreign f utures
          exchanges is the clearinghouse associated with the particular exchange.
          In
          general, clearinghouses are backed by their members who may be required
          to share
          in the financial burden resulting from the nonperformance of one of their
          members, and therefore, this additional member support should significantly
          reduce credit risk. Some foreign exchanges are not backed by their clearinghouse
          members but may be backed by a consortium of banks or other financial
          institutions. There
          can
          be no assurance that any counterparty, clearinghouse, or their members
          or their
          financial backers will satisfy their obligations to US12OF in such
          circumstances.
  The
          General Partner attempts to manage the credit risk of US12OF by following
          various trading limitations and policies. In particular, US12OF posts margin
          and/or holds liquid assets that are approximately equal to the face amount
          of
          its obligations to counterparties under the Futures Contracts and Other
          Crude Oil Related Investments it holds. The General Partner has implemented
          procedures that include, but are not limited to, executing and clearing
          trades
          only with creditworthy parties and/or requiring the posting of collateral
          or
          margin by such parties for the benefit of US12OF to limit its credit exposure.
  UBS
          Securities LLC, US12OF's commodity broker, or any other broker that may
          be
          retained by US12OF in the future, when acting as US12OF's futures commission
          merchant in accepting orders to purchase or sell Futures Contracts on United
          States exchanges, is required by CFTC regulations to separately
          account for and segregate as belonging to US12OF, all assets of US12OF
          relating
          to domestic Futures Contracts trading. A futures commission merchant is
          not
          allowed to commingle US12OF's assets with its other assets. In addition,
          the
          CFTC requires commodity brokers to hold in a secure account the US12OF
          assets
          related to foreign Futures Contracts trading.
  Off
          Balance Sheet
          Financing
 
 As
          of
          December 31, 2007, US12OF has no loan guarantee, credit support or other
          off-balance sheet arrangements of any kind other than agreements entered
          into in
          the normal course of business, which may include indemnification provisions
          relating to certain risks that service providers undertake in performing
          services which are in the best interests of US12OF. While US12OF's exposure
          under these indemnification provisions cannot be estimated, they are not
          expected to have a material impact on US12OF's financial position.
 58
 Redemption
          Basket
          Obligation
 
 In
          order
          to meet its investment objective and pay its contractual obligations described
          below, US12OF requires liquidity to redeem units, which redemptions must be
          in blocks of 100,000 units called Redemption Baskets. US12OF has to
          date satisfied this obligation by paying from the cash or cash equivalents
          it holds or through the sale of its Treasuries in an amount proportionate
          to the number of units being redeemed.
  Contractual
          Obligations
 
 US12OF's
          primary contractual obligations are with the General Partner. In return
          for its
          services, the General Partner is entitled to a management fee calculated
          as a
          fixed percentage of US12OF's NAV, currently 0.60% of NAV for its average
          net
          assets.
  The
          General Partner agreed to pay the start-up costs associated with the formation
          of US12OF, primarily its legal, accounting and other costs in connection
          with
          its contracts with service providers and its registration with the SEC
          and other
          regulatory filings in connection with the initial public offering of the
          units,
          and the registration fees paid to the SEC, FINRA and the AMEX in connection
          with
          such offering. The General Partner agreed to pay the fees of the custodian
          and
          transfer agent, BBH&Co., as well as BBH&Co.’s fees for performing
          administrative services, including in connection with US12OF’s preparation of
          its financial statements and its SEC and CFTC
          reports.
   In
          addition to the General Partner’s management fee, US12OF pays its brokerage fees
          (including fees to the futures commission merchant), over-the-counter dealer
          spreads, any licensing fees for the use of intellectual property, registration
          and, subsequent to the initial offering, the fees paid to the SEC, FINRA,
          or
          other regulatory agencies in connection with the offer and sale of the
          units,
          tax accounting and reporting fees, as well as the legal, printing, accounting,
          and other expenses associated therewith, and extraordinary expenses. The
          latter
          are expenses not in the ordinary course of US12OF's business, including
          the
          indemnification of any person against liabilities and obligations to the
          extent
          permitted by law and under the LP Agreement, the bringing or defending
          of
          actions in law or in equity or otherwise conducting litigation and incurring
          legal expenses and the settlement of claims and litigation. Commission
          payments
          to the futures commission merchant are on a contract-by-contract, or round
          turn,
          basis.  In addition, US12OF pays a portion of the fees and expenses of
          the independent directors of the General Partner.  See Note 3 to the
          Notes to Statement of Financial Condition.
  The
          parties cannot anticipate the amount of payments
          that will be required under these arrangements for future periods as US12OF’s
          net asset values and trading levels to meet its investment objectives will
          not
          be known until a future date. These agreements are effective for a specific
          term
          agreed upon by the parties with an option to renew, or, in some cases,
          are in
          effect for the duration of US12OF’s existence. Either party may terminate these
          agreements earlier for certain reasons listed in the
          agreements.
 59
 Item
            7A.  Quantitative
            and Qualitative
            Disclosure About Market Risk
  Over-the-Counter
          Derivatives
          (Including Spreads and Straddles)
 In
            the
            future, US12OF may purchase over-the-counter contracts. Unlike most of
            the
            exchange-traded oil futures contracts or exchange-traded options on such
            futures, each party to over-the-counter contract bears the credit risk
            that the
            other party may not be able to perform its obligations under its
            contract.
  Some
            oil-based derivatives transactions contain fairly generic terms and conditions
            and are available from a wide range of participants. Other oil-based
            derivatives
            have highly customized terms and conditions and are not as widely available.
            Many of these over-the-counter contracts are cash-settled forwards for
            the
            future delivery of oil- or petroleum-based fuels that have terms similar
            to the
            Futures Contracts. Others take the form of “swaps” in which the two parties
            exchange cash flows based on pre-determined formulas tied to the spot
            price of
            the crude oil, forward crude oil prices or crude oil futures prices. For
            example, US12OF may enter into over-the-counter derivative contracts
            whose value
            will be tied to changes in the difference between the spot price of light,
            sweet crude oil, the price of Futures Contracts traded on NYMEX and the
            prices of other Futures Contracts that may be invested in by
            US12OF.
  To
            protect itself from the credit risk that arises in connection with such
            contracts, US12OF may enter into agreements with each counterparty that
            provide
            for the netting of its overall exposure to its counterparty, such as
            the
            agreements published by the International Swaps and Derivatives Association,
            Inc. US12OF also may require that the counterparty be highly rated and/or
            provide collateral or other credit support to address US12OF’s exposure to the
            counterparty. In addition, it is also possible for US12OF and its counterparty
            to agree to clear their agreement through an established futures clearing
            house
            such as those connected to the NYMEX or the ICE Futures. In that event,
            US12OF
            would no longer have credit risk of its original counterparty, as the
            clearing
            house would now be US12OF's counterparty. US12OF would still retain any
            price
            risk associated with its transaction.
  US12OF
            may employ spreads or straddles in its trading to mitigate the differences
            in
            its investment portfolio and its goal of tracking the price of the Benchmark
            Oil
            Futures Contract. US12OF would use a spread when it chooses to take simultaneous
            long and short positions in futures written on the same underlying asset,
            but
            with different delivery months. The effect of holding such combined positions
            is
            to adjust the sensitivity of US12OF to changes in the price relationship
            between
            futures contracts which will expire sooner and those that will expire
            later.
            US12OF would use such a spread if the General Partner felt that taking
            such long
            and short positions, when combined with the rest of its holdings, would
            more
            closely track the investment goals of US12OF, or the General Partner
            felt if it
            would lead to an overall lower cost of trading to achieve a given level
            of
            economic exposure to movements in oil prices. US12OF would enter into
            a straddle
            when it chooses to take an option position consisting of a long (or short)
            position in both a call option and put option. The economic effect of
            holding
            certain combinations of put options and call options can be very similar
            to that
            of owning the underlying futures contracts. US12OF would make use of
            such a
            straddle approach if, in the opinion of the General Partner, the resulting
            combination would more closely track the investment goals of US12OF or
            if it
            would lead to an overall lower cost of trading to achieve a given level
            of
            economic exposure to movements in oil prices.
  During
              the period from December 6, 2007 to December 31, 2007, US12OF did not
              employ any hedging methods since all of its investments were made over
              an
              exchange. Therefore, US12OF was not exposed to counterparty
              risk.
 60
 Item 8.
              Financial
                  Statements and
                  Supplementary Data.
 Index
            to Financial
            Statements
  Documents
                  
                  PageReport
                      of Independent Registered Public Accounting
                      Firm
                  
                  
                  62Statement
                      of Financial Condition at December 31,
                      2007
                  
                  
                  63Condensed
Schedule
                    of Investments at December 31,
                    2007
                  
                  
                  64Statement
                      of Operations for the period from June 27,
                      2007 (inception) to December 31, 2007
                  
                  
                  65Statement
                    of Changes in Partners' Capital for the period
                    from June 27, 2007 (inception) to December 31, 2007
                  
                  
                  66Statement
                      of Cash Flows for the period from June
                      27, 2007 (inception) to December 31, 2007
                  
                  
                  67Notes
                      to Financial Statements
                  
                  
                  68
 61
 
 Reportof Independent Registered Public Accounting
            Firm
 
 To
            the
            Partners of
 United
              States 12 Month Oil Fund, LP
  We
                have
                audited the accompanying statement of financial condition of United
                States 12
                Month Oil Fund, LP, (the “Fund”) as of December 31, 2007, including the
                condensed schedule of investments as of December 31, 2007, and the
                related
                statements of operations, changes in partners’ capital and cash flows for the
                period from June 27, 2007 (inception) to December 31, 2007. These
                financial
                statements are the responsibility of the Fund’s management. Our responsibility
                is to express an opinion on these financial statements based on our
                audit.
 
 We
                conducted our audit in accordance with the standards of the
                Public Company Accounting Oversight Board (United States). Those
                standards
                require that we plan and perform the audit to obtain reasonable assurance
                about
                whether the financial statements are free of material misstatement.
                The Fund is
                not required to have, nor were we engaged to perform, an audit of
                its internal
                control over financial reporting. Our audit included consideration
                of internal
                control over financial reporting as a basis for designing audit procedures
                that
                are appropriate in the circumstances, but not for the purpose of
                expressing an
                opinion on the effectiveness of the Fund’s internal control over financial
                reporting. Accordingly, we express no such opinion. An audit also
                includes
                examining, on a test basis, evidence supporting the amounts and disclosures
                in
                the financial statements, assessing the accounting principles used
                and
                significant estimates made by management, as well as evaluating the
                overall
                financial statement presentation. We believe that our audit provides
                a
                reasonable basis for our opinion.
 
 In
                our
                opinion, the financial statements referred to above present fairly,
                in all
                material respects, the financial position of United States 12 Month
                Oil Fund, LP
                as of December 31, 2007, and the results of its operations and its
                cash flows
                for the period from June 27, 2007 (inception) to December 31, 2007
                in conformity
                with accounting principles generally accepted in the United States
                of
                America.
 /s/ SPICER
              JEFFRIES
              LLP
  Greenwood
              Village, Colorado
 March
              20, 2008


62
 
 United
                      States 12 Month Oil Fund, LPStatement
                      of Financial
                      ConditionAt
                      December 31,
                      2007December
                      31,
                      2007AssetsCash
                      and cash equivalents
                  
                  $
                  18,174,276Equity
                      in UBS Securities LLC trading accounts:Cash
                  
                  
                  1,999,108Unrealized
                      gain on open commodity futures contracts
                  
                  
                  1,525,370Interest
                      receivable
                  
                  
                  4,994Total
                      assets
                  
                  $
                  21,703,748Liabilities
                      and Partners'
                      CapitalGeneral
                      Partner management fees (Note 3)
                  
                  $
                  8,790Accrued tax reporting costs
                  
                  
                  2,600Other
                      liabilities
                  
                  
                  879Total
                      liabilities
                  
                  
                  12,269Commitments
                      and Contingencies(Notes 3,
                      4 and 5)Partners'
                      CapitalGeneral
                      Partner
                  
                  
                  -Limited
                      Partners
                  
                  
                  21,691,479Total
                      Partners'
                      Capital
                  
                  
                  21,691,479Total
                      liabilities and
                      partners' capital
                  
                  $
                  21,703,748Limited
                      Partners' units outstanding, December 31, 2007
                  
                  
                  400,000Net
                    asset value per unit, (inception) June 27, 2007
                  
                  $
                  0.00Net
                      asset value per unit (commencement of operations, December
                      6,
                      2007)
                  
                  $
                  50.00Net
                      asset value per unit, December 31, 2007
                  
                  $
                  54.23Market
                      value per unit, December 31, 2007
                  
                  $
                  53.88See
                      accompanying notes
                      to financial statements.
 63
 United
                            States
                            12 Month Oil Fund, LPCondensed
                            Schedule of
                            InvestmentsAt
                            December 31,
                            2007Open
                            Futures ContractsGain
                            on
                            OpenNumber
                            of
                        
                        Commodity
                        
                        %
                            of
                            Partners'Contracts
                        
                        Contracts
                        
                        CapitalUnited
                            States
                            ContractsCrude
                            Oil Futures contracts, expires February 2008
                        
                        
                        19
                        
                        $
                        151,860
                        
                        
                        0.70Crude
                            Oil Futures contracts, expires March 2008
                        
                        
                        20
                        
                        
                        161,850
                        
                        
                        0.74Crude
                            Oil Futures contracts, expires April 2008
                        
                        
                        19
                        
                        
                        148,020
                        
                        
                        0.68Crude
                            Oil Futures contracts, expires May 2008
                        
                        
                        20
                        
                        
                        149,550
                        
                        
                        0.69Crude
                            Oil Futures contracts, expires June 2008
                        
                        
                        19
                        
                        
                        134,150
                        
                        
                        0.62Crude
                            Oil Futures contracts, expires July 2008
                        
                        
                        19
                        
                        
                        129,490
                        
                        
                        0.60Crude
                            Oil Futures contracts, expires August 2008
                        
                        
                        19
                        
                        
                        121,220
                        
                        
                        0.56Crude
                            Oil Futures contracts, expires September 2008
                        
                        
                        20
                        
                        
                        121,400
                        
                        
                        0.56Crude
                            Oil Futures contracts, expires October 2008
                        
                        
                        19
                        
                        
                        108,700
                        
                        
                        0.50Crude
                            Oil Futures contracts, expires November 2008
                        
                        
                        20
                        
                        
                        108,700
                        
                        
                        0.50Crude
                            Oil Futures contracts, expires December 2008
                        
                        
                        19
                        
                        
                        96,840
                        
                        
                        0.45Crude
                            Oil Futures contracts, expires January 2009
                        
                        
                        19
                        
                        
                        93,590
                        
                        
                        0.43232
                        
                        $
                        1,525,370
                        
                        
                        7.03
  Cash
                        
                        
                        18,174,276
                        
                        
                        83.78Total
                          cash and cash equivalents
                        
                        
                        18,174,276
                        
                        
                        83.78Cash
                            on deposit with
                            broker
                        
                        
                        1,999,108
                        
                        
                        9.22Liabilities,
                            less
                            receivables
                        
                        
                        (7,275
                        )
                        
                        (0.03
                        )Total
                            Partners'
                            Capital
                        
                        $
                        21,691,479
                        
                        
                        100.00See
                            accompanying notes
                            to financial statements.
 64
 United
                            States 12 Month Oil
                            Fund, LPStatement
                            of OperationsFor
                            the period from June 27,
                            2007 (inception) to December 31, 2007Period
                          fromJune
                          27, 2007 toDecember
                            31,
                            2007IncomeGains on
                            trading of commodity futures contracts:Change
                            in unrealized gains on open positions
                        
                        $
                        1,525,370Interest
                            income
                        
                        
                        49,954Other
                            income
                        
                        
                        2,000Total
                            income
                        
                        
                        1,577,324ExpensesGeneral
                            Partner management fees (Note 3)
                        
                        
                        8,790Brokerage
                            commissions
                        
                        
                        892Other
                            expenses
                        
                        
                        3,479Total
                            expenses
                        
                        
                        13,161Net
                            income
                        
                        $
                        1,564,163Net
                            income per limited
                            partnership unit
                        
                        $
                        4.23Net
                            income per weighted average
                            limited partnership unit
                        
                        $
                        3.98Weighted
                            average limited
                            partnership units outstanding
                        
                        
                        392,593See
                            accompanying notes to
                            financial statements.
 65
 United
                          States 12 Month Oil
                          Fund, LPStatement
                          of Changes in
                          Partners' CapitalFor
                          the period from June 27,
                          2007 (inception) to December 31, 2007General
                          Partner
                      
                      Limited
                          Partners
                      
                      TotalBalances, at Inception,
                        June 27,
                        2007
                      
                      $
                      -
                      
                      $
                      -
                      
                      $
                      -Initial contribution of capital
                      
                      
                      20
                      
                      
                      980
                      
                      
                      1,000Addition
                          of 400,000 partnership units
                      
                      
                      -
                      
                      
                      20,127,316
                      
                      
                      20,127,316Redemption
                          of initial General Partner and Limited Partner
                          investment
                      
                      
                      (20
                      )
                      
                      (980
                      )
                      
                      (1,000
                      )Net
                          income
                      
                      
                      -
                      
                      
                      1,564,163
                      
                      
                      1,564,163Balances,
                          at December 31,
                          2007
                      
                      $
                      -
                      
                      $
                      21,691,479
                      
                      $
                      21,691,479Net
                          Asset Value Per
                          UnitAt July 27, 2007 (inception)
                      
                      $
                      0.00At
                          December 6, 2007 (commencement of operations)
                      
                      $
                      50.00At
                          December 31, 2007
                      
                      $
                      54.23See
                          accompanying notes
                          to financial statements.
  66
 United
                          States 12 Month Oil
                          Fund, LPStatement
                          of Cash FlowsPeriod
                          from June 27, 2007
                          (inception) to December 31, 2007Period
                        fromJune
                        27, 2007 toDecember
                          31, 2007Cash
                          Flows from Operating
                          Activities:Net
                          income
                      
                      $
                      1,564,163Adjustments
                          to reconcile net income to net cash used in operating
                          activities:Increase
                          in commodity futures trading account - cash
                      
                      
                      (1,999,108
                      )Unrealized
                          gains on futures contracts
                      
                      
                      (1,525,370
                      )Increase in
                          interest receivable and other assets
                      
                      
                      (4,994
                      )Increase
                          in management fees payable
                      
                      
                      8,790Increase
                          in other liabilities
                      
                      
                      3,479Net
                          cash used in operating
                          activities
                      
                      
                      (1,953,040
                      )Cash
                          Flows from Financing
                          Activities:Subscription
                          of partnership units and initial contribution
                      
                      
                      20,128,316Redemption of initial General Partner and Limited Partner
                        investment
                      
                      
                      (1,000
                      )Net
                          cash provided
                          by financing activities
                      
                      
                      20,127,316Net
                          Increase in Cash and Cash
                          Equivalents
                      
                      
                      18,174,276Cash
                          and Cash
                          Equivalents,
                          beginning of period
                      
                      
                      -Cash
                          and Cash
                          Equivalents,
                          end of period
                      
                      $
                      18,174,276See
                          accompanying notes
                          to financial statements.
 67
 United
            States
            12 Month Oil Fund, LP
 Notes
          to Financial
          Statements
 For
          the period ended December 31,
          2007
  NOTE
          1 - ORGANIZATION AND
          BUSINESS
 
 United
          States 12 Month Oil Fund, LP ("US12OF"), was organized as a limited partnership
          under the laws of the state of Delaware on June 27, 2007. US12OF is a commodity
          pool that issues units that may be purchased and sold on the American Stock
          Exchange (the "AMEX"). US12OF will continue in perpetuity, unless terminated
          sooner upon the occurrence of one or more events as described in
          its Amended and Restated Agreement of Limited Partnership dated as of
          December 4, 2007 (the "LP Agreement"). The investment objective of US12OF
          is for
          the changes in percentage terms of its net asset value to reflect the changes
          in
          percentage terms of the price of crude oil delivered to Cushing,
          Oklahoma, as measured by the changes in the average of the prices of the
          12 futures contracts on crude oil as traded on the New York
          Mercantile Exchange (the "NYMEX"), consisting of 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 measured by the futures contracts
          that are the next month contract to expire and the contracts for the following
          11 consecutive months, less US12OF's expenses. US12OF will accomplish its
          objectives through investments in futures contracts for light, sweet crude
          oil,
          and other types of crude oil, heating oil, gasoline, natural gas and other
          petroleum-based fuels that are traded on the NYMEX, ICE Futures or other
          U.S.
          and foreign exchanges (collectively, "Futures Contracts") and other oil-related
          investments such as cash-settled options on Futures Contracts, forward
          contracts
          for oil, and over-the-counter transactions that are based on the price
          of crude
          oil, heating oil, gasoline, natural gas and other petroleum-based fuels,
          Futures
          Contracts and indices based on the foregoing (collectively, "Other Crude
          Oil
          Related Investments"). As of December 31, 2007, US12OF held 232 Futures
          Contracts traded on the NYMEX.
  US12OF
          commenced operations on December 6, 2007 and
          has a fiscal year ending on December 31. Victoria Bay Asset Management,
          LLC (the
          "General Partner") and an affiliate of the General Partner were the initial
          general partner and limited partner contributing $20 and $980, respectively.
          When US12OF commenced operations, they redeemed their initial
          investment. The General
          Partner of US12OF is responsible for the management of US12OF. The
          General Partner is a member of the National Futures Association (the "NFA")
          and
          became a commodity pool operator with the Commodity Futures Trading
          Commission effective December 1, 2005. The General Partner is also the
          general
          partner of United States Oil Fund, LP ("USOF"), United States Natural Gas
          Fund, LP ("USNG") and United States Gasoline Fund, LP ("USG") which listed
          their units on the AMEX under the ticker symbols "USO" on April 10,
          2006, "UNG" on April 18, 2007 and "UGA" on February 26, 2008,
          respectively.
  US12OF
          issues limited partnership interests ("units") to certain authorized purchasers
          ("Authorized Purchasers") by offering baskets consisting of 100,000 units
          ("Creation Baskets") through ALPS Distributors, Inc. (the "Marketing
          Agent"). The purchase price for a Creation Basket is based upon the net
          asset
          value of a unit determined as of 4:00 p.m. New York time on the day the
          order to create the basket is properly received. In addition, Authorized
          Purchasers pay US12OF a $1,000 fee for each order to create one or
          more Creation Baskets. Units can be purchased or sold on a nationally
          recognized securities exchange in smaller increments than a Creation Basket.
          Units purchased or sold on a nationally recognized securities exchange
          are not
          made at the net asset value of US12OF but rather at market prices quoted
          on such
          exchange.
 
 In
          November 2007, US12OF initially registered 11,000,000 units on Form S-1
          with the
          Securities and Exchange Commission (the "SEC"). On
          December 6, 2007, US12OF listed its units on the AMEX under the ticker
          symbol
“USL”. On that day, US12OF established its initial net asset value by setting
          the price at $50.00 per unit and issued 300,000 units in exchange for
          $15,000,000. The initial offering price of the initial Creation Basket
          was based
          on the closing price of the near month Futures Contracts as traded and
          reported
          on the NYMEX on the last business day prior to the effective date of US12OF's
          initial registration statement filed on Form S-1. As of December 31, 2007,
          US12OF had registered a total of 11,000,000 units. US12OF also commenced
          investment operations on December 6, 2007 by purchasing Futures Contracts
          traded on the NYMEX based on light, sweet crude oil.
  NOTE
          2 - SUMMARY OF SIGNIFICANT
          ACCOUNTING POLICIES
 
 Revenue
          Recognition
 
 Commodity
          futures contracts, forward contracts, physical commodities, and related
          options
          are recorded on the trade date. All such transactions are recorded on the
          identified cost basis and marked to market daily. Unrealized gains or losses
          on
          open contracts are reflected in the condensed statement of financial condition
          and are the difference between the original contract amount and the market
          value
          (as determined by exchange settlement prices for futures contracts and
          related
          options and cash dealer prices at a predetermined time for forward contracts,
          physical commodities, and their related options) as of the last business
          day of
          the year or as of the last date of the condensed financial statements.
          Changes
          in the unrealized gains or losses between periods are reflected in the
          condensed
          statement of operations. The Fund earns interest on its assets denominated
          in
          U.S. dollars on deposit with the futures commission merchant at the 90-day
          Treasury bill rate. In addition, US12OF earns interest on funds held at
          the
          custodian at prevailing market rates earned on such investments.
 
 Brokerage
          Commissions
 
 Brokerage
          commissions on all open commodity futures contracts are accrued on a full-turn
          basis.
  Income
            Taxes
 
 US12OF
            is
            not subject to federal income taxes; each partner reports his/her allocable
            share of income, gain, loss deductions or credits on his/her own income
            tax
            return.
  Additions
              and
              Redemptions
 
 Authorized
              Purchasers may purchase Creation Baskets from US12OF as of the beginning
              of each
              business day based upon the prior day's net asset value. Authorized
              Purchasers
              may redeem units from US12OF only in blocks of 100,000 units called
“Redemption
              Baskets”. The amount of the redemption proceeds for a Redemption Basket will
              be
              equal to the net asset value of the units in the Redemption Basket
              determined as
              of 4:00 p.m. New York time on the day the order to redeem the basket
              is properly
              received.
  US12OF
              receives or pays the proceeds from units sold
              or redeemed one business day after the trade-date of the purchase or
              redemption.
              The amounts due from Authorized Purchasers are reflected in
              US12OF's statement of financial condition as receivable for units sold, and
              amounts payable to Authorized Purchasers upon redemption are reflected
              as
              payable for units redeemed.
 68
 Partnership
          Capital and Allocation of
          Partnership Income and Losses
 
 Profit
          or
          loss shall be allocated among the partners of US12OF in proportion to the
          number
          of units each partner holds as of the close of each month. The General
          Partner
          may revise, alter or otherwise modify this method of allocation as described
          in
          the LP Agreement.
 
 Calculation
          of Net Asset
          Value
 
 US12OF
          calculates net asset value on each trading day by taking the current market
          value of its total assets, subtracting any liabilities and dividing the
          amount
          by the total number of units issued and outstanding. US12OF uses the closing
          price for the contracts on the relevant exchange on that day to determine
          the
          value of contracts held on such exchange.
 
 Net
          Income (Loss)
          per Unit
 
 Net
          income (loss) per unit is the difference between the net asset value per
          unit at the beginning of each period and at the end of each period. The
          weighted average number of units outstanding was computed for purposes of
          disclosing net loss per weighted average unit. The weighted average units
          are
          equal to the number of units outstanding at the end of the period, adjusted
          proportionately for units redeemed based on the amount of time the units
          were
          outstanding during such period. There were no units held by the General
          Partner at December 31, 2007.
  Offering
            Costs
 
 Offering
            costs incurred in connection with the registration of additional units
            after the
            initial registration of units are borne by US12OF. These costs include
            registration fees paid to regulatory agencies and all legal, accounting,
            printing and other expenses associated therewith. These costs will be
            accounted
            for as a deferred charge and thereafter amortized to expense over twelve
            months
            on a straight line basis or a shorter period if
            warranted.
 
 Cash
          Equivalents
 
 Cash
          and
          cash equivalents include money market portfolios and overnight time deposits
          with original maturity dates of three months or less.
 
 Use
          of Estimates
 
 The
          preparation of financial statements in conformity with accounting
          principles generally accepted in the United States of America requires
          US12OF’s
          management to make estimates and assumptions that affect the reported amount
          of
          assets and liabilities and disclosure of contingent assets and liabilities
          at
          the date of the condensed financial statements, and the reported amounts
          of the
          revenue and expenses during the reporting period. Actual results could
          differ
          from those estimates and assumptions.
  NOTE 3
            - FEES PAID BY THE FUND
            AND RELATED PARTY TRANSACTIONS 
 General
              Partner Management
              Fee
 
 Under
            the
            LP Agreement, the General Partner is responsible for investing the assets
            of
            US12OF in accordance with the objectives and policies of US12OF. In addition,
            the General Partner has arranged for one or more third parties to provide
            administrative, custody, accounting, transfer agency and other necessary
            services to US12OF. For these services, US12OF is contractually obligated
            to pay
            the General Partner a fee, which is paid monthly and based on average
            daily net
            assets, that is equal to 0.60% per annum on average net assets.
  Ongoing
              Registration Fees and Other
              Offering Expenses
 
 US12OF
                  pays all costs and expenses associated with the
                  ongoing registration of units subsequent to the initial offering.
                  These costs include registration or other fees paid to regulatory
                  agencies in
                  connection with the offer and sale of units, and all legal, accounting,
                  printing
                  and other expenses associated with such offer and sale. For the
                  period from June 27, 2007 to December 31, 2007, US12OF incurred $0 in
                  registration fees and other offering expenses. The General Partner
                  incurred
                  $350,639 in initial registration  fees and other offering expenses on
                  behalf of US12OF during this period.
 Director's
                Fees
  US12OF
                is
                responsible for paying the fees and expenses, including directors'
                and officers'
                liability insurance, of the independent directors of the General
                Partner who are
                also audit committee members. US12OF shares these fees with USOF,
                USG and USNG based on the relative assets of each fund, computed on a
                daily
                basis. These fees for calendar year 2007 amounted to a total of $286,000
                for all
                of the funds.
  Investor
                  Tax Reporting
                  Cost
  The
                  fees
                  and expenses associated with US12OF's tax accounting and reporting
                  requirements,
                  with the exception of certain initial implementation service fees
                  and base
                  service fees which are borne by the General Partner, are paid by
                  US12OF. These costs are estimated to be $25,000 for the period ended
                  December 31, 2007.
  Other
                Expenses and
                Fees
  In
                addition to the fees described above,
                US12OF pays all brokerage fees, taxes and other expenses in connection with
                the operation of US12OF, excluding costs and expenses paid by the General
                Partner as outlined in Note 4.
 69
 NOTE
          4 - CONTRACTS AND
          AGREEMENTS
 
 US12OF
          is
          party to a marketing agent agreement, dated as of November 13, 2007, with
          the Marketing Agent, whereby the Marketing Agent provides certain marketing
          services for US12OF as outlined in the agreement. The fees of the Marketing
          Agent, which are borne by the General Partner, are equal to 0.06% on
          US12OF's assets up to $3 billion; and 0.04% on US12OF's assets in excess
          of $3
          billion.
 
 The
          above
          fees do not include the following expenses, which are also borne by the
          General
          Partner: the cost of placing advertisements in various periodicals; web
          construction and development; or the printing and production of various
          marketing materials.
 
 US12OF
          is
          also party to a custodian agreement, dated October 5, 2007, with Brown
          Brothers
          Harriman & Co. ("BBH&Co."), whereby BBH&Co. holds investments on
          behalf of US12OF. The General Partner pays the fees of the custodian, which
          shall be determined by the parties from time to time. In addition, US12OF
          is
          party to an administrative agency agreement, dated October 5, 2007, with
          the
          General Partner and BBH&Co., whereby BBH&Co. acts as the administrative
          agent, transfer agent and registrar for US12OF. The General Partner also
          pays
          the fees of BBH&Co. for its services under this agreement and such fees will
          be determined by the parties from time to time.
 
 Currently,
          the General Partner pays BBH&Co. for its services, in the foregoing
          capacities, the greater of a minimum of $125,000 annually or an asset-based
          charge of (a) 0.06% for the first $500 million of US12OF's, USOF's, USNG's
          and USG's combined net assets, (b) 0.0465% for US12OF's, USOF's, USNG's and
          USG's combined net assets greater than $500 million but less than $1
          billion, and (c) 0.035% for USOF's, USNG's, US12OF's and USG's combined net
          assets in excess of $1 billion. The General Partner also pays a $25,000
          annual
          fee for the transfer agency services and transaction fees ranging from
          $7.00 to
          $15.00 per transaction.
 
 US12OF
          invests primarily in Futures Contracts traded on the NYMEX. On January
          16, 2008,
          US12OF and the NYMEX entered into a license agreement whereby US12OF was
          granted
          a non-exclusive license to use certain of the NYMEX's settlement prices
          and
          service marks. The agreement has an effective date of December 4, 2007
          with
          respect to US12OF. Under the license agreement, US12OF and the
          affiliated funds managed by the General Partner pay the NYMEX an asset-based
          fee
          for the license, the terms of which are described in Note 3.
 
 US12OF
          expressly disclaims any association with the NYMEX or endorsement of US12OF
          by
          the NYMEX and acknowledges that “NYMEX” and “New York Mercantile Exchange” are
          registered trademarks of the NYMEX.
 
 US12OF
          has entered into a brokerage agreement with UBS Securities LLC ("UBS
          Securities"). The agreement requires UBS Securities to provide services
          to
          US12OF in connection with the purchase and sale of Futures Contracts and
          Other Crude Oil Related Investments that may be purchased and sold by or
          through
          UBS Securities for US12OF's account. The agreement provides that UBS Securities
          charge US12OF commissions of approximately $7per round-turn trade, plus applicable exchange and NFA fees
          for Futures Contracts and options on Futures Contracts.
 
 NOTE
          5 - FINANCIAL INSTRUMENTS,
          OFF-BALANCE SHEET RISKS AND CONTINGENCIES
 
 US12OF
          engages in the speculative trading of Futures Contracts and options on
          Futures Contracts (collectively, "derivatives"). US12OF is exposed to both
          market risk, which is the risk arising from changes in the market value
          of the
          contracts, and credit risk, which is the risk of failure by another party
          to
          perform according to the terms of a contract.
 
 All
          of
          the contracts currently traded by US12OF are exchange-traded. The risks
          associated with exchange-traded contracts are generally perceived to be
          less
          than those associated with over-the-counter transactions since, in
          over-the-counter transactions, US12OF must rely solely on the credit of
          their
          respective individual counterparties. However, in the future, if US12OF
          were to enter into non-exchange traded contracts, it would be subject to
          the
          credit risk associated with counterparty non-performance. The credit risk
          from
          counterparty non-performance associated with such instruments is the net
          unrealized gain, if any. US12OF also has credit risk since the sole counterparty
          to all domestic and foreign futures contracts is the exchange on which the
          relevant contracts are traded. In addition, US12OF bears the risk of financial
          failure by the clearing broker.
  The
            purchase and sale of futures and options on futures contracts require
            margin
            deposits with a futures commission merchant. Additional deposits may
            be
            necessary for any loss on contract value. The Commodity Exchange Act
            requires a
            futures commission merchant to segregate all customer transactions and
            assets
            from the futures commission merchant’s proprietary activities.
 
 US12OF’s
            cash and other property, such as U.S. Treasury Bills, deposited with
            a futures
            commission merchant are considered commingled with all other customer
            funds
            subject to the futures commission merchant’s segregation requirements. In the
            event of a futures commission merchant’s insolvency, recovery may be limited to
            a pro rata share of segregated funds available. It is possible that the
            recovered amount could be less than the total of cash and other property
            deposited.
  US12OF
            invests its cash in money market funds that seek to maintain a stable
            net asset
            value. US12OF is exposed to any risk of loss associated with an investment
            in
            these money market funds. As of December 31, 2007, US12OF had deposits
            in
            domestic and foreign financial institutions in the amount of $20,173,384.
            This
            amount is subject to loss should these institutions cease
            operations.
  For
              derivatives, risks arise from changes in the market value of the contracts.
              Theoretically, US12OF is exposed to a market risk equal to the value
              of futures
              contracts purchased and unlimited liability on such contracts sold
              short. As
              both a buyer and a seller of options, US12OF pays or receives a premium
              at the
              outset and then bears the risk of unfavorable changes in the price
              of the
              contract underlying the option.
 
 US12OF’s
              policy is to continuously monitor its exposure to market and counterparty
              risk
              through the use of a variety of financial, position and credit exposure
              reporting controls and procedures. In addition, US12OF has a policy
              of requiring
              review of the credit standing of each broker or counterparty with which it
              conducts business.
 
 The
              financial instruments held by US12OF are reported in its
              condensed statement of financial condition at market or fair value, or at
              carrying amounts that approximate fair value, because of their highly
              liquid
              nature and short-term maturity.
  Goldman,
                Sachs & Co. (“Goldman Sachs”) sent USOF a letter on March 17, 2006,
                providing USOF and the General Partner notice under 35 U.S.C. Section
                154(d) of
                two pending United States patent applications, Publication Nos. 2004/0225593A1
                and 2006/0036533A1. Both patent applications are generally directed
                to a method
                and system for creating and administering a publicly traded interest
                in a
                commodity pool. In particular, the Abstract of each patent application
                defines a
                means for creating and administering a publicly traded interest in
                a commodity
                pool that includes the steps of forming a commodity pool having a
                first position
                in a futures contract and a corresponding second position in a margin
                investment, and issuing equity interests of the commodity pool to
                third party
                investors. Subsequently, two U.S. Patents were issued; the first,
                patent number
                US7,283,978B2, was issued on October 16, 2007, and the second, patent
                number
                US7,319,984B2, was issued on January 15, 2008.
 
 Preliminarily,
                USOF's management is of the view that the structure and operations of USOF
                and its affiliated commodity pools do not infringe these patents.
                USOF
                is also in the process of reviewing prior art (prior structures and
                operations of similar investment vehicles) that may invalidate one
                or more of
                the claims in these patents. In addition, USOF has retained patent
                counsel to
                advise it on these matters and is in the process of obtaining their
                opinions
                regarding the non-infringement of each of these patents by USOF and/or
                the
                patents' invalidity based on prior art. If the patents were alleged
                to apply to
                USOF's structure and/or operations, and are found by a court to be
                valid and
                infringed, Goldman Sachs may be awarded significant monetary damages
                and/or
                injunctive relief. See
                “US12OF's Operating Risks — Third parties may infringe upon or
                otherwise violate intellectual property rights or assert that the
                General
                Partner has infringed or otherwise violated their intellectual property
                rights,
                which may result in significant costs and diverted
                attention.”
 70
 NOTE 6
          - FINANCIAL
          HIGHLIGHTS
 
 The
          following table presents per unit performance data and other supplemental
          financial data for the period from December 6, 2007 (commencement of operations)
          to December 31, 2007 for the limited partners. This information has been
          derived
          from information presented in the condensed financial statements.
  December
                      6, 2007(commencement
                      ofoperations)
                      toDecember
                      31, 2007Per
                      Unit Operating
                      Performance:Net
                      asset value, commencement of operations
                  
                  $
                  50.00Total income
                  
                  
                  4.26Total
                      expenses
                  
                  
                  (0.03
                  )Net
                      increase in net asset value
                  
                  
                  4.23Net
                      asset value, end of period
                  
                  $
                  54.23Total
                      Return
                  
                  
                  8.46
                  %Ratios
                      to Average Net Assets
                      (annualized)Total income
                  
                  
                  107.67
                  %Expenses
                      excluding management fees
                  
                  
                  (0.30
                  )%Management
                      fees
                  
                  
                  (0.60
                  )%Net
                      income
                  
                  
                  106.77
                  %
  Total
          returns are calculated based on the change in value during the period.
          An
          individual limited partner’s total return and ratio may vary from the above
          total returns and ratios based on the timing of contributions to and withdrawals
          from US12OF.
 NOTE 7
            - QUARTERLY FINANCIAL
            DATA (Unaudited)
 
 The
            following summarized (unaudited) quarterly financial information presents
            the
            results of operations and other data for three-month periods ended March
            31,
            June 30, September 30 and December 31, 2007.
  First
                      Quarter
                    
                    Second
                      Quarter
                    
                    Third
                      Quarter
                    
                    Fourth
                      Quarter2007
                    
                    2007
                    
                    2007
                    
                    2007Total
                        Income
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    1,577,324Total
                        Expenses
                    
                    -
                    
                    -
                    
                    -
                    
                    13,161Net
                        Income
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    1,564,163Net
                        Income per limited partner unit
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    4.23
  NOTE 8
                - SUBSEQUENT
                EVENTS
 
 Licensing
                  Fees
  As
                  discussed in Note 4, US12OF entered into a licensing agreement with the
                  NYMEX on January 16, 2008. The agreement has an effective date
                  of December 4,
                  2007 with respect to US12OF. Pursuant to the agreement, US12OF
                  and the
                  affiliated funds managed by the General Partner will pay a licensing
                  fee that is
                  equal to 0.04% for the first $1,000,000,000 of combined assets of the funds
                  and 0.02% for combined assets above $1,000,000,000. Since inception,
                  US12OF has incurred $540 under this
                  arrangement.
 71
 Item 9.
              Changes
                  in and Disagreements
                  With Accountants on Accounting and Financial
                  Disclosure.
  Not
        applicable.
  Item 9A.
              Controls
                  and
                  Procedures.
  Disclosure
          Controls and
          Procedures.
  US12OF
          maintains disclosure controls and procedures that are designed to ensure
          that
          material information required to be disclosed in US12OF’s periodic reports
          filed or submitted under the Exchange Act, is recorded, processed, summarized
          and reported within the time period specified in the SEC’s rules and
          forms.
  The
          duly
          appointed officers of the General Partner, including its chief executive
          officer and chief financial officer who perform functions equivalent
          to those of a principal executive officer and principal financial officer
          of
          US12OF if US12OF had any officers, have evaluated the effectiveness of
          US12OF’s
          disclosure controls and procedures and have concluded that the disclosure
          controls and procedures of US12OF have been effective as of the end of
          the
          period covered by this annual report on Form
          10-K.
 
 Management’s
          Annual Report on
          Internal Control Over Financial Reporting and Attestation Report of Registered
          Public Accounting Firm.
  This
          annual report on Form 10-K does not include a report of management's assessment
          regarding internal control over financial reporting or an attestation report
          of
          US12OF's registered public accounting firm due to a transistion period
          established by the rules of the SEC for newly public companies.
  Change
          in Internal Control Over
          Financial Reporting.
  There
          were no changes in US12OF’s internal control over financial reporting during
          US12OF’s last fiscal quarter that have materially affected, or are reasonably
          likely to materially affect, US12OF’s internal control over financial
          reporting.
 Item 9B.
              Other
                  Information.
  Monthly
            Account
            Statements.
  Pursuant
            to the requirement under part 4.22 of the CEA, each month US12OF publishes
            an
            account statement for its unitholders, which includes a Statement of
            Income
            (Loss) and a Statement of Changes in NAV. The account statement is filed
            with
            the SEC on a current report on Form 8-K pursuant to Section 13 or 15(d)
            of the
            Exchange Act and posted each month on US12OF's website at
            www.unitedstates12monthoilfund.com.
 72
 Part
        III
 
 Item 10.
              Directors,
                  Executive Officers
                  and Corporate Governance.
  Messrs.
        Gerber and Mah also serve as executive officers of the General Partner. US12OF
        has no executive officers. Its affairs are generally managed by the General
        Partner. The following individuals serve as Management Directors of the General
        Partner.
 Nicholas
            Gerber has been the President and CEO of the General Partner since June
            9, 2005 and a Management Director of the General Partner since May 10,
            2005. He
            maintains his main business office at 1320 Harbor Bay Parkway, Suite
            145,
            Alameda, California 94502. Mr. Gerber acts as a portfolio manager for
            US12OF,
            USOF, USNG and USG. Mr. Gerber will act as a portfolio manager for USHO
            and
            US12NG. He registered with the NFA as a Principal of the General Partner
            in
            November 2005, and as an Associated Person of the General Partner in
            December
            2005. Currently, Mr. Gerber manages US12OF, USOF, USNG and USG. He will
            also
            manage USHO and US12NG. Mr. Gerber has also served as Vice President/Chief
            Investment Officer of Lyon’s Gate Reinsurance Company, Ltd. since June of 2003.
            Mr. Gerber has an extensive background in securities portfolio management
            and in
            developing investment funds that make use of indexing and futures contracts.
            He
            is also the founder of Ameristock Corporation, a California-based investment
            adviser registered under the Advisers Act, that has been sponsoring and
            providing portfolio management services to mutual funds since 1995. Since
            1995,
            Mr. Gerber has been the portfolio manager of the Ameristock Mutual Fund,
            Inc. a
            mutual fund registered under the 1940 Act, focused on large cap U.S.
            equities
            that currently has approximately $482 million in assets. He has also
            been a
            Trustee for the Ameristock ETF Trust since June 2006, and a portfolio
            manager
            for the Ameristock/Ryan 1 Year, 2 Year, 5 Year, 10 Year and 20 Year Treasury
            ETF
            since June 2007. In these roles, Mr. Gerber has gained extensive experience
            in
            evaluating and retaining third-party service providers, including custodians,
            accountants, transfer agents, and distributors. Prior to managing Ameristock
            Mutual Fund Inc., Mr. Gerber served as a portfolio manager with Bank
            of America
            Capital Management. While there he was responsible for the daily stewardship
            of
            four funds with a combined value in excess of $240 million. At Bank of
            America
            Capital Management, Mr. Gerber worked extensively in the development
            and
            managing of mutual funds and institutional accounts that were designed
            to track
            assorted equity market indices such as the Standard & Poor’s 500 and the
            Standard & Poor’s Midcap 400. Before joining Bank of America, he was
            managing director and founder of the Marc Stevens Futures Index Fund,
            a fund
            that combined the use of commodity futures with equity stock index futures.
            The
            futures index fund was a commodity pool and Mr. Gerber was the CPO. It
            was
            ultimately purchased by Newport Commodities. Mr. Gerber’s two decades of
            experience in institutional investment include a period of employment
            as a floor
            trader on the NYMEX. Mr. Gerber has passed the Series 3 examination for
            associated persons. He holds an MBA in finance from the University of
            San
            Francisco and a BA from Skidmore College. Mr. Gerber is 45 years
            old.
 
 Howard
            Mah
            has been a Management Director of the General Partner since May 10, 2005,
            Secretary of the General Partner since June 9, 2005, and Chief Financial
            Officer
            of the General Partner since May 23, 2006. In these roles, Mr. Mah is
            currently
            involved in the management of US12OF, USOF, USNG and USG and will be
            involved in the management of USHO and US12NG. Mr. Mah also serves as
            the
            General Partner’s Chief Compliance Officer. He received a Bachelor of Education
            from the University of Alberta, in 1986 and an MBA from the University
            of San
            Francisco in 1988. He has been Secretary and Chief Compliance Officer
            of the
            Ameristock ETF Trust since February 2007, Compliance Officer of Ameristock
            Corporation since 2001, a tax & finance consultant in private practice since
            1995, Secretary of Ameristock Mutual Fund since 1995 and Ameristock Focused
            Value Fund from December 2000 to January 2005, Chief Compliance Officer
            of
            Ameristock Mutual Fund since 2004 and the Co-Portfolio Manager of the
            Ameristock
            Focused Value Fund from December 2000 to January 2005. Mr. Mah is 43
            years
            old.
 
 Andrew
            F.
            Ngim has been a Management Director of the General Partner since May
            10,
            2005 and Treasurer of the General Partner since June 9, 2005. As Treasurer
            of
            the General Partner, Mr. Ngim is currently involved in the management
            of US12OF,
            USOF, USNG and USG and will be involved in the management of USHO and
            US12NG. He received a Bachelor of Arts from the University of California
            at
            Berkeley in 1983. Mr. Ngim has been the Managing Director and co-portfolio
            manager of Ameristock Corporation since 1999, Trustee of the Ameristock
            ETF
            Trust since February 2007, and a portfolio manager for the Ameristock/Ryan
            1
            Year, 2 Year, 5 Year, 10 Year and 20 Year Treasury ETF since June 2007.
            He was
            the co-portfolio manager of the Ameristock Large Company Growth Fund
            from
            December 2000 to June 2002 and a Benefits Consultant with PricewaterhouseCoopers
            from 1994 to 1999. Mr. Ngim is 47 years old.
 
 Robert
            L.
            Nguyen has been a Management Director of the General Partner since May
            10, 2005. As a Management Director of the General Partner, Mr. Nguyen
            is
            currently involved on the management of US12OF, USOF, USNG and USG and will
            be involved in the management of USHO and US12NG. He received a Bachelor
            of
            Science from California State University Sacramento in 1981. Mr. Nguyen
            has been
            the Managing Principal of Ameristock Corporation since 2000. He was Co-Portfolio
            Manager of the Ameristock Large Company Growth Fund from December 2000
            to June
            2002 and Institutional Specialist with Charles Schwab & Company Inc. from
            1995 to 1999. Mr. Nguyen is 48 years old.


73
 
 The
            following individuals provide significant services to US12OF but are
            employed by
            the entities noted below.
 
 John
            P.
            Love acts as the Portfolio Operations Manager for US12OF, USOF, USNG
            and
            USG and is expected to be the Portfolio Operations Manager for USHO and
            US12NG. Mr. Love is also employed by the General Partner. Mr. Love has
            served as
            the operations manager of Ameristock Corporation since 2002, where he
            was
            responsible for back office and marketing activities for the Ameristock
            Mutual
            Fund and Ameristock Focused Value Fund and for the firm in general. From
            1993 to
            September 2002, Mr. Love was a project manager and managing director
            for IT and
            interactive media development firms, including TouchVision Interactive
            and
            Digital Boardwalk Inc. providing leadership to project teams from pre-contract
            through deployment, while assisting with business and process development.
            As
            the managing director of Jamison/Gold (Keane Interactive), he provided
            leadership to all departments including operations, production, technology,
            sales, marketing, administration, recruiting, and finance. Mr. Love holds
            a
            Series 3 license and is registered with the NFA as an Associated Person
            of the
            General Partner. He holds a BFA in cinema-television from the University
            of
            Southern California. Mr. Love is 36 years old.
 
 John
            T. Hyland,
            CFA acts as a Portfolio Manager and as the Chief Investment Officer
            for
            the General Partner. Mr. Hyland is employed by the General Partner. He
            registered with the NFA as an Associated Person of the General Partner
            in
            December 2005, and as a Principal of the General Partner in January
            2006. Mr. Hyland became the Portfolio Manager for USOF, USNG, US12OF
            and USG in April 2006, March 2007, June 2007 and April 2007, respectively,
            and
            as Chief Investment Officer of the General Partner, acts in such capacity
            on
            behalf of USOF, USNG, US12OF and USG.  He is also expected to become
            the Portfolio Manager for USHO and US12NG. As part of his responsibilities
            for US12OF, USOF, USNG and USG, Mr. Hyland handles day-to-day trading,
            helps set
            investment policies, and oversees US12OF’s, USOF’s, USNG’s and
            USG's activities with its futures commission brokers,
            custodian-administrator, and marketing agent. Mr. Hyland has an extensive
            background in portfolio management and research with both equity and
            fixed
            income securities, as well as in the development of new types of complex
            investment funds. In July 2001, Mr. Hyland founded Towerhouse Capital
            Management, LLC, a firm that provides portfolio management and new fund
            development expertise to non-U.S. institutional investors. Mr. Hyland
            has been,
            and remains, a Principal and Portfolio Manager for Towerhouse. From July
            2001 to
            January 2002, Mr. Hyland was the Director of Global Property Securities
            Research
            for Roulac International, where he worked on the development of a hedge
            fund
            focused on global real estate stocks. From 1996 through 2001, Mr. Hyland
            was the
            Director of Securities Research and Portfolio Manager for the capital
            markets
            division of CB Richard Ellis, a global commercial real estate services
            firm. His
            division provided portfolio management of equities as an advisor or sub-advisor
            for mutual funds and separate accounts focused on real estate investment
            trusts.
            In addition, his group conducted research in the area of structured commercial
            real estate debt (including Commercial Mortgage-Back Securities, or “CMBS”), and
            lead the creation of one of the earliest re-securitizations of multiple
            CMBS
            pool tranches into a Collateralized Debt Obligation vehicle. In the ten
            years
            prior to working at CB Richard Ellis, Mr. Hyland had worked as a portfolio
            manager or financial representative for several other investment firms
            and
            mutual funds. Mr. Hyland received his Chartered Financial Analyst (“CFA”)
            designation in 1994. From 1993 until 2003, Mr. Hyland was on the Board
            of
            Directors of the Security Analysts of San Francisco (“SASF”), a not-for-profit
            organization of investment management professionals. He served as the
            president
            of the SASF from 2001-2002. Mr. Hyland is a member of the CFA Institute
            (formerly AIMR). He is also a member of the National Association of Petroleum
            Investment Analysts, a not-for-profit organization of investment professionals
            focused on the oil industry. He serves as an arbitrator for FINRA, as
            part of
            their dispute resolution program. He is a graduate of the University
            of
            California, Berkeley and received a BA in political science/international
            relations in 1982. Mr. Hyland is 48 years old.
  74
 The
          following individuals serve as independent directors of the General
          Partner.
 
 Peter
          M.
          Robinson has been an Independent Director of the General Partner since
          September 30, 2005 and, as such, serves on the board of directors of the
          General
          Partner, which acts on behalf of US12OF, USOF, USNG and USG and will
          serve on behalf of US12NG and USHO, if such funds commence operations.
          Mr.
          Robinson has been employed as a Research Fellow with the Hoover Institution
          since 1993. Mr. Robinson graduated from Dartmouth College in 1979 and Oxford
          University in 1982. Mr. Robinson spent six years in the White House, serving
          from 1982 to 1983 as chief speechwriter to Vice President George Bush and
          from
          1983 to 1988 as special assistant and speechwriter to President Ronald
          Reagan.
          After the White House, Mr. Robinson received an MBA from the Stanford University
          Graduate School of Business. Mr. Robinson then spent a year in New York
          City
          with Fox Television. He spent a second year in Washington, D.C., with the
          SEC,
          where he served as the director of the Office of Public Affairs, Policy
          Evaluation, and Research. Mr. Robinson has also written three books and
          has been
          published in the New York
          Times, Red Herring, and Forbes ASAP and he
          is the
          editor of Can Congress Be
          Fixed?: Five Essays on Congressional Reform (Hoover Institution Press,
          1995). Mr. Robinson is 50 years old.
 
 Gordon
          L.
          Ellis has been an Independent Director of the General Partner since
          September 30, 2005 and, as such, serves on the board of directors of the
          General
          Partner, which acts on behalf of US12OF, USOF, USNG and USG and will
          serve on behalf of US12NG and USHO, if such funds commence operations.
          Mr. Ellis
          has been Chairman of International Absorbents, Inc. since July 1988, President
          and Chief Executive Officer since November 1996 and a Class I Director
          of the
          company since July 1985. Mr. Ellis is also a director of Absorption Corp.,
          International Absorbents, Inc.’s wholly-owned subsidiary. Mr. Ellis is a
          director/trustee of Polymer Solutions, Inc., a former publicly-held company
          that
          sold all of its assets effective as of February 3, 2004 and is currently
          winding
          down its operations and liquidating following such sale. Mr. Ellis is a
          professional engineer with an MBA in international finance. Mr. Ellis is
          60
          years old.
 
 Malcolm
          R. Fobes
          III has been an Independent Director of the General Partner since
          September 30, 2005 and, as such, serves on the board of directors of the
          General
          Partner, which acts on behalf of US12OF, USOF, USNG and USG and will
          serve on behalf of US12NG and USHO, if such funds commence operations.
          Mr. Fobes
          is the founder, Chairman and Chief Executive Officer of Berkshire Capital
          Holdings, Inc., a California-based investment adviser registered under
          the
          Advisers Act, that has been sponsoring and providing portfolio management
          services to mutual funds since 1997. Since 1997, Mr. Fobes has been the
          Chairman
          and President of The Berkshire Funds, a mutual fund investment company
          registered under the 1940 Act. Mr. Fobes also serves as portfolio manager
          of the
          Berkshire Focus Fund, a mutual fund registered under the 1940 Act, which
          concentrates its investments in the electronic technology industry. From
          April
          2000 to July 2006, Mr. Fobes also served as co-portfolio manager of The
          Wireless
          Fund, a mutual fund registered under the 1940 Act, which concentrates its
          investments in companies engaged in the development, production, or distribution
          of wireless-related products or services. In these roles, Mr. Fobes has
          gained
          extensive experience in evaluating and retaining third-party service providers,
          including custodians, accountants, transfer agents, and distributors. Mr.
          Fobes
          was also contributing editor of Start a Successful Mutual Fund: The Step-by-Step
          Reference Guide to Make It Happen (JV Books, 1995). Prior to forming Berkshire
          Capital Holdings, Inc., Mr. Fobes was employed by various technology-related
          companies, including Adobe Systems, Inc., a leading provider of digital
          publishing and imaging software technologies. Mr. Fobes holds a B.S. degree
          in
          Finance and Economics from San Jose State University in California. Mr.
          Fobes is
          43 years old.
 
 The
          following are individual principals, as that term is defined in CFTC Rule
          3.1,
          for the General Partner: Melinda Gerber, the Gerber Family Trust, Howard
          Mah,
          Andrew Ngim, Robert Nguyen, Peter Robinson, Gordon Ellis, Malcolm Fobes,
          John
          Love, and John Hyland. These individuals are principals due to their positions,
          however, Nicholas Gerber and Melinda Gerber are also principals due to
          their
          controlling stake in Wainwright. None of the principals owns or has any
          other
          beneficial interest in US12OF. Nicholas Gerber and John Hyland make trading
          and
          investment decisions for US12OF. Nicholas Gerber, John Love, and John Hyland
          execute trades on behalf of US12OF. In addition, Nicholas Gerber, John
          Love,
          John Hyland and Robert Nguyen are registered with the CFTC as Associated
          Persons
          of the General Partner and are associate members of the NFA.
 Audit
          Committee
 
 The
          General Partner has an audit committee which is made up of the three independent
          directors (Peter M. Robinson, Gordon L. Ellis, and Malcolm R. Fobes III).
          The
          audit committee is governed by an audit committee charter that is posted
          on
          US12OF’s website. The
          Board
          has not made a determination as to whether any of the members of the audit
          committee may be considered to be an “Audit Committee Financial Expert” as such
          term is defined in Item 407(d)(5) of Regulation S-K. However, the Board
          believes
          that Messrs. Fobes and Ellis are able to read and understand financial
          statements and meet the financial sophistication requirements of the AMEX
          and
          applicable FINRA rules as they relate to audit committees. As such, given
          the
          limited scope of US12OF’s activities and the qualifications and experience of
          all of the members of the audit committee, the board of directors does
          not
          believe it is necessary to designate a member of the audit committee as
          an
“Audit Committee Financial Expert.”
  Other
          Committees
 
 Since
          the
          individuals who perform work on behalf of US12OF are not compensated by
          US12OF,
          but instead by the General Partner, Ameristock or ALPS Distributors, Inc.,
          US12OF does not have a compensation committee. Similarly, since the Directors
          noted above serve on the board of directors of the General Partner, there
          is no
          nominating committee of the board of directors that acts on behalf of US12OF.
 75
 
 Code
            of Ethics
 The
              General Partner of US12OF has adopted a Code of Business Conduct and
              Ethics (the
“Code of Ethics”) that applies to its principal executive officer, principal
              financial officer, principal accounting officer or controller, or persons
              performing similar functions, and also to US12OF, USOF, USNG, USG,
              USHO and
              US12NG.  US12OF has posted the text of the Code of Ethics on its
              website at www.unitedstates12monthoilfund.com.  US12OF intends to
              disclose any amendments or waivers to the Code of Ethics applicable
              to the
              General Partner’s principal executive officer, principal financial officer,
              principal accounting officer or controller, or persons performing similar
              functions, on its website.  A copy of the Code of Ethics has been filed
              with the SEC.
  Item 11.
              Executive
                  Compensation.
  Compensation
          to the General Partner
          and Other Compensation.
  US12OF
          does not directly compensate any of the executive officers noted above. The
          executive officers noted above are compensated by the General Partner for
          the work they perform on behalf of US12OF and other entities controlled
          by the
          General Partner. US12OF does not reimburse the General Partner, nor does
          it set
          the amount or form of any portion of the compensation paid to the executive
          officers by the General Partner. US12OF pays fees to the General Partner
          pursuant to the LP Agreement, under which the fund is obligated to pay the
          General Partner an annualized fee of 0.50% of average daily net assets
          of US12OF
          for the first $1,000,000,000 and 0.20% of average daily net assets of US12OF
          for
          amounts above $1,000,000,000. For the period from December 6, 2007 to December
          31, 2007 US12OF paid the General Partner aggregate fees of $8,790.
  Director
          Compensation
 
 The
          following table sets forth compensation earned during the period from December
          6, 2007 to December 31, 2007, by the Directors of the General Partner.
  Change
                        inPensionValue
                        andFees
                    
                    
                    
                    
                    
                    
                    
                    NonqualifiedEarned
                        or
                    
                    
                    
                    
                    
                    Non-Equity
                    
                    DeferredPaid
                        in
                    
                    Stock
                    
                    Option
                    
                    Incentive
                        Plan
                    
                    Compensation
                    
                    All
                        OtherName
                    
                    Cash
                    
                    Awards
                    
                    Awards
                    
                    Compensation
                    
                    Plan
                    
                    Compensation
                        (1)
                    
                    TotalManagement
                        DirectorsNicholas
                        Gerber
                    
                    $
                    0
                    
                    
                    NA
                    
                    
                    NA
                    
                    
                    NA
                    
                    $
                    0
                    
                    $
                    0
                    
                    $
                    0Andrew
                        F. Ngim
                    
                    $
                    0
                    
                    
                    NA
                    
                    
                    NA
                    
                    
                    NA
                    
                    $
                    0
                    
                    $
                    0
                    
                    $
                    0Howard
                        Mah
                    
                    $
                    0
                    
                    
                    NA
                    
                    
                    NA
                    
                    
                    NA
                    
                    $
                    0
                    
                    $
                    0
                    
                    $
                    0Robert
                        L. Nguyen
                    
                    $
                    0
                    
                    
                    NA
                    
                    
                    NA
                    
                    
                    NA
                    
                    $
                    0
                    
                    $
                    0
                    
                    $
                    0Independent
                        DirectorsPeter
                        M. Robinson
                    
                    $
                    0
                    
                    
                    NA
                    
                    
                    NA
                    
                    
                    NA
                    
                    $
                    0
                    
                    $
                    89,000
                    
                    $
                    89,000Gordon
                        L. Ellis
                    
                    $
                    0
                    
                    
                    NA
                    
                    
                    NA
                    
                    
                    NA
                    
                    $
                    0
                    
                    $
                    88,000
                    
                    $
                    88,000Malcolm
                        R. Fobes III
                    
                    $
                    0
                    
                    
                    NA
                    
                    
                    NA
                    
                    
                    NA
                    
                    $
                    0
                    
                    $
                    109,000
                    
                    $
                    109,000
 (1)
          Payments made under this column represent cash payments made in lieu of
          directors’ and officers’ insurance coverage. Such payments were made only to the
          Independent Directors of the General Partner for their service on the boards
          of
          USOF, USNG and US12OF.
 76
 
 Item 12.
              Security
                  Ownership of Certain
                  Beneficial Owners and Management and Related Stockholder
                  Matters.
 
 None
        of
        the directors or executive officers of the General Partner, nor the employees
        of
        US12OF own any units of US12OF. In addition, US12OF is not aware of any 5%
        holder of its units.
  Item 13.
              Certain
                  Relationships and
                  Related Transactions, and Director
                  Independence.
  US12OF
        has and will continue to have certain
        relationships with the General Partner and its affiliates. However, there
        have been no direct financial transactions between US12OF and the directors
        or
        officers of the General Partner that have not been disclosed herein. See
        "Item 11. Executive Compensation" and "Item 12. Security Ownership of Certain
        Beneficial Owners and Management and Related Stockholder Matters." Any
        transaction with a related person that must be disclosed in accordance with
        SEC
        Regulation S-K item 404(a), including financial transactions by US12OF with
        directors or executive officers of the General Partner or holders of beneficial
        interests in the General Partner or US12OF of more than 5%, will be subject
        to
        the provisions regarding "Resolutions of Conflicts of Interest; Standard
        of
        Care" as set forth in Section 7.7 of the LP Agreement and will be reviewed
        and
        approved by the audit committee of the General Partner.
  Item 14.
              Principal
                  Accountant Fees and
                  Services.
  During
          the period from December 6, 2007 to December 31, 2007, the General Partner
          made
          the following payments to its independent auditors:
 2007Audit
                    fees
                
                $
                27,500Audit-related
                    fees
                
                
                -Tax
                    fees
                
                
                -All
                    other fees
                
                
                -$
                27,500
  Audit
          fees consist of fees paid to Spicer Jeffries LLP for (i) the audit of
          US12OF’s annual financial statements included in the Annual Report on Form 10-K,
          and review of financial statements included in the Quarterly Reports on
          Form
          10-Q and filed on US12OF's current reports on Form 8-K; and
          (ii) services
          that are normally provided by the Independent Registered Public Accountants
          in
          connection with statutory and regulatory filings or engagements.
  The
            audit
            committee has established policies and procedures which are intended
            to control
            the services provided by US12OF’s independent auditors and to monitor their
            continuing independence.  Under these policies and procedures, no
            audit or permitted non-audit services (including fees and terms thereof),
            except
            for the de minimis
            exceptions for non-audit services described in Section 10A(i)(1)(B) of
            the
            Exchange Act, may be undertaken by US12OF’s independent auditors unless the
            engagement is specifically pre-approved by the audit committee.  The
            audit committee may form and delegate authority to subcommittees consisting
            of
            one or more members when appropriate, including the authority to grant
            pre-approvals of audit and permitted non-audit services, provided that
            decisions
            of such subcommittee to grant pre-approvals must be presented to the
            full audit
            committee at its next scheduled meeting.
 77
 Part
        IV
 Item 15.
                  Exhibits
                      and Financial
                      Statement
                      Schedules.
 1.
                See
                    Index to Financial Statements on page 61.2.
                No
                    financial statement schedules are filed herewith because (i)
                    such
                    schedules are not required or (ii) the information required has
                    been
                    presented in the aforementioned financial statements.3.
                Exhibits
                    required to be filed by Item 601 of Regulation
                    S-K.
 
 Exhibit
          Index
  Listed
          below are the exhibits which are filed or furnished as part of this annual
          report on Form 10-K (according to the number assigned to them in Item 601
          of
          Regulation S-K):
 Exhibit
                        Number
                    
                    Description
                        of
                        Document3.1*
                    
                    Form
                        of
                        the Amended and Restated Agreement of Limited
                        Partnership.3.2*
                    
                    Certificate
                        of Limited
                        Partnership of the Registrant.10.1**
                    
                    Form
                        of Initial
                        Authorized Purchaser Agreement.10.2**
                    
                    Form
                        of Marketing
                        Agent Agreement.10.3**
                    
                    Form
                        of Custodian
                        Agreement.10.4**
                    
                    Form
                        of Administrative
                        Agency Agreement.10.5***
                    
                    Amendment
                        to the License Agreement.14.1***
                    
                    Code
                      of
                      Ethics.
  31.1***
                  
                  Certification
                      of Principal Executive Officer Pursuant to
                      Rule 13a-14(a) under the Securities Exchange Act of
                      1934.31.2***
                  
                  Certification
                      of Principal Financial Officer Pursuant to
                      Rule 13a-14(a) under the Securities Exchange Act of
                      1934.32.1****
                  
                  Certification
                      of Principal Executive Officer Pursuant to
                      Section 906 of the Sarbanes-Oxley Act of 2002 (18 U. S. C.
                      1350).32.2****
                  
                  Certification
                      of Principal Financial Officer Pursuant to
                      Section 906 of the Sarbanes-Oxley Act of 2002 (18 U. S. C.
                      1350).
 *       Incorporated
            by reference to Registrant’s Registration Statement on Form S-1 (File No.
            333-144348) filed on July 5, 2007.
 **Incorporated
            by reference to
            Registrant’s Pre-Effective Amendment No. 2 to the Registration Statement on Form
            S-1 (File No. 333-144348) filed on November 16, 2007.
 ***       
Filed
            herewith.
 ****      Furnished
            herewith.
 78
 SIGNATURES
  Pursuant
        to the requirements of Section 13 or 15(d) of the Securities Exchange Act
        of
        1934, the registrant has duly caused this Report to be signed on its behalf
        by
        the undersigned, thereunto duly authorized.
  United
                  States 12 Month Oil Fund, LP (Registrant)
                By:
                  Victoria Bay Asset Management, LLC, its general partner/s/
                  Nicholas D. GerberNicholas
                  D.
                  GerberChief
                  Executive Officer ofVictoria
                  Bay Asset
                  Management, LLC
                (Principal
                  executive
                  officer)DateDate:
                  March 26, 2008/s/
                Howard
                MahHoward
                  MahChief
                  Financial Officerof Victoria
                  Bay
                  Asset Management, LLC
                (Principal
                  financial and
                  accounting officer)DateDate:
                  March 26, 2008
 
 79
  Pursuant
        to the requirements of
        the Securities Exchange Act of 1934, this Report has been signed below by
        the
        following persons on behalf of the Registrant in the capacities and on the
        dates
        indicated.
 Signature
                  Title
                    (Capacity)
                  Date/s/
                    Nicholas D.
                    Gerber
                  Management
                    Director
                  March 26,
                    2008Nicholas
                    D.
                    Gerber/s/
                    Howard
                    Mah
                  Management
                    Director
                  March 26,
                    2008Howard
                    Mah/s/
                    Andrew
                    Ngim
                  Management
                    Director
                  March 26,
                    2008Andrew
                    Ngim/s/
                    Robert
                    Nguyen
                  Management
                    Director
                  March 26,
                    2008Robert
                    Nguyen/s/
                    Peter M.
                    Robinson
                  Independent
                    Director
                  March 26,
                    2008Peter
                    M.
                    Robinson/s/
                    Gordon L.
                    Ellis
                  Independent
                    Director
                  March 26,
                    2008Gordon
                    L.
                    Ellis/s/
                    Malcolm R.
                    Fobes III
                  Independent
                    Director
                  March 26,
                    2008Malcolm
                    R. Fobes
                    III
 80