The United States Oil Fund (USO) and the ProShares Ultra Bloomberg Crude Oil Fund (UCO) were nearly killed in April's oil market crash. But they managed to survive and have learned their lesson.

A lot of oil funds weren't nearly so lucky when the May crude oil futures contract fell to below -$40 a barrel before recovering by the expiration date. The iPath Series B S&P GSCI Crude Oil Total Return Index ETN (OIL) wasn't so lucky and chose to liquidate by exercising its early call option. It shut down officially on April 30. A number of other smaller and/or lesser-known oil funds also shuttered when steep losses or ultra-low share prices either motivated them to liquidate or forced them to close per their original agreements.

USO and UCO, which had passively tracked the nearest-term oil futures contracts and rolled over every month, essentially became active funds in order to survive what happened. I covered the events pretty extensively, which you can read about at the following links.

Leveraged Oil ETF UCO Undergoing A 1:25 Reverse Split

OIL, One Of The Largest Oil ETNs, Will Be Shut Down And Liquidated

Largest Oil Fund, USO, On The Brink Of Collapse

Oil ETF USO Announces 1:8 Reverse Split

USO: Bottom Is In; Buyers Are Returning; $4 Price Target

USO To Exit June 2020 Contracts Completely & Add Even Longer Dated Expirations Instead

Oil ETF USO Announces It Can Add Gasoline, Diesel, Natural Gas To The Fund's Portfolio

You can click on the links to any of the articles shown if you want a play-by-play of what's happened over the past month, but it'd be safe to say that USO has become a watered-down version of its former self.

As a fund that used to strictly target the nearest expiration oil contracts, it was a pretty close proxy to the price of oil itself. But now it's extended itself into contracts up to one year out, which has significantly altered USO's risk/return profile.

Today, USO looks like this.

Screen Shot 2020-05-18 at 2.31.03 PM

It's staying away from the nearest month altogether and has positions all the way out to 12 months in the future.

UCO is essentially the same way.

Screen Shot 2020-05-18 at 2.32.38 PM

It doesn't go quite as far out in the future, but December contract exposure is much different than it was before.

What Happens Later This Week

I've written previously that I believed the June contract, which expires this week, was at risk of going to $0 or even negative, just like the May contract did. I argued that if economic conditions were substantially the same - a huge oversupply of crude combined with zero demand due to the coronavirus - we could see a repeat occurrence.

At this point, that seems pretty unlikely. The June contract is up above $30 and has been climbing steadily for about three weeks, not exactly the price action that indicates traders trying to liquidate positions. At the fundamental commodity level, it seems that the crude oil price environment has stabilized substantially.

And even if it hadn't, USO and UCO have rebranded themselves in a way that's specifically designed to avoid the short-term risks that sank the market a month ago.

Even if the near-term contract does go to $0, both funds have eliminated any exposure to that contract helping to ensure that the prices of both stay in a safe area. That isn't to say that they won't experience price declines, but it's become highly unlikely that they'll reach the point where they need to do another reverse split just in order to survive.