Company Overview

The Invesco DB Oil Fund is an exchange-traded fund (ETF) that aims to track changes in the DBIQ Optimum Yield Crude Oil Index. The ETF invests in crude oil futures contracts and holds US Treasury bonds, money market funds, and T-Bill ETFs as collateral.

The fund is managed by Invesco Capital Management LLC.

Financial Highlights

Fund Performance

In Q1 2024, the ETF’s net asset value (NAV) per share increased by 11.60% from $13.96 at the start of the quarter to $15.58 at the end. This was mainly driven by a $1.45 gain on investments in crude oil futures contracts.

The market price per share also rose by 11.64% in Q1 2024, from $13.92 to $15.54.

Revenue and Expenses

The fund had a net investment income of $0.17 per share in Q1 2024. The expense ratio was 0.73% of average net assets after fee waivers and 0.80% before waivers.

Crude Oil Market Trends

Crude oil prices increased in Q1 2024 due to:

• Geopolitical tensions in the Middle East and Ukraine raising supply disruption risks
• Improving economic outlook and potential Federal Reserve easing
• OPEC+ production cuts tightening global supplies

These factors created a supportive environment for crude oil prices.

Portfolio Composition

The fund aims to match its aggregate notional value of futures contracts to its net assets. It held US Treasuries, money market funds, and T-Bill ETFs as collateral assets.

The fund may invest in other commodity futures besides crude oil if gaining exposure through the index contracts becomes impractical.

Risk Factors

Key risks faced by the fund include:

• Commodity price volatility
• Futures contract liquidity constraints
• Counterparty credit risk
• Position limits and accountability levels

The fund has margin requirements and payment obligations for its futures trading and management fees.

Liquidity and Capital Position

The fund meets margin requirements and collateral needs through cash generated from share issuances and redemptions to authorized participants.

It has no long-term capital commitments with adequate liquidity to meet its near-term obligations.

Cash Flows

In Q1 2024, the fund had net cash inflows of $19.8 million from operating activities and outflows of $19.8 million from financing activities. This was driven by futures trading and share issuances/redemptions.

The fund invests cash collateral in US Treasuries, money market funds, and T-Bill ETFs.

Future Outlook

The crude oil market outlook remains supportive in 2024 due to geopolitics, economic growth, and tight supplies. However, volatility and liquidity risks persist.

The fund aims to match the performance of the DBIQ Optimum Yield Crude Oil Index through its futures trading strategy. But past performance does not guarantee future results.