A Trump-Tied Law Firm ‘Played Both Sides Of The Ledger’ During Oil Market Crash
A law firm that previously employed President Donald Trump’s interior secretary and has multiple clients in the U.S. fossil fuel sector continued to represent Saudi Arabia through an oil price war that devastated U.S. oil drillers earlier this year.
Since 2016, the government of Saudi Arabia has paid Colorado-based lobbying giant Brownstein Hyatt Farber Schreck more than $6.7 million to represent its interests in Washington, according to data from the nonprofit Center for Responsive Politics.
In April, HuffPost reported on the firm’s lucrative relationship with Saudi Arabia as the kingdom and Russia flooded the market with cheap oil. But it was unclear at the time if BHFS retained the Saudi government as a client into 2020.
New regulatory filings to the Department of Justice now confirm that BHFS not only represented the kingdom through a standoff that rocked domestic producers, but that its work for the kingdom early this year included lobbying specifically on oil and gas issues.
Prior to joining the Trump administration in August 2017, Interior Secretary David Bernhardt was an attorney and shareholder at BHFS, where he lobbied on behalf of fossil fuel, mining and agricultural interests that are now benefiting from the administration’s aggressive environmental rollbacks. After Trump’s election, the law firm publicly touted its “significant relationships” with “those who will steer the incoming Trump administration.”
In the years since, it has seen its revenues from lobbying the Interior Department balloon as fossil fuel and other industries attempt to sway an agency at the heart of the Trump administration’s so-called “energy dominance” agenda and now run by one of the firm’s former partners.
According to a Sept. 30 filing, Martha “Mimi” Burke, a policy adviser at BHFS, met with Rep. Angie Craig (D-Minn.) on May 7 to discuss a flotilla of some two dozen Saudi oil tankers that began arriving at U.S. shores early that month, loaded with more than 40 million barrels of crude oil.
The tankers, which the Saudis launched beginning in late March as part of the price battle, added to the woes of domestic producers as they struggled to stay afloat amid a historic oversupply of oil and a steep decline in global demand due to the coronavirus pandemic. At least two U.S. drilling companies, Whiting Petroleum Corp. and Diamond Offshore Drilling, cited the price war in announcing bankruptcy in April.
President Donald Trump speaks during a roundtable meeting with energy sector CEOs at the White House on April 3. U.S. oil companies were hit hard by both the effects of the coronavirus and from foreign pressures caused by Russia and Saudi Arabia in the oil markets.
Along with the Saudi government, lobbying disclosure data shows BHFS continues to represent several oil and gas interests that the Saudi-led market crash affected. The firm’s domestic clients include, among others, the American Petroleum Institute, the leading trade association of the U.S. oil and gas industry; Oklahoma-based natural gas company WPX Energy, which late last month merged with Devon Energy; and Texas oil exploration and production company Hunt Consolidated.
Jayson O’Neill, project director at Western Values Project, a left-leaning public lands and oil industry watchdog group, accused BHFS of “playing both sides of the ledger to make as much money as possible.”
It is surprising “that neither the President nor the [Interior] Secretary seems to mind that his old lobby shop’s efforts are derailing Trump’s energy dominance fantasy by allowing excess crude to be dumped into domestic markets, further depressing prices,” he said.
Neither BHFS nor the Saudi Embassy in Washington responded to HuffPost’s requests for comment. Craig’s office also did not respond.
Russian President Vladimir Putin and de facto Saudi ruler Crown Prince Mohammed bin Salman at the G-20 summit in Osaka, Japan, in June 2019.
Burke, who spent more than two decades working in Saudi Arabia’s embassy in Washington before joining BHFS as a lobbyist in 2017, also met between May and June with Reps. Chrissy Houlahan (D-Penn.), Dan Kildee (D-Mich.) and Eric Swalwell (D-Calif.) to lobby on bipartisan legislation that aimed to prevent the 14-member Organization of the Petroleum Exporting Countries, better known as OPEC, from coordinating production and setting prices.
As Reuters reported, Saudi Arabia threatened in April to sell its oil in currencies other than the dollar if Congress passed the bill, aptly named the No Oil Producing and Exporting Cartels Act, or NOPEC. First introduced in 2000 but never enacted, the bill would allow for the cartel to be prosecuted under antitrust laws.
The Saudi-Russian oil battle and coronavirus pandemic upended an American fossil fuel sector that had enjoyed a comfortable three years under Trump. As oil prices plummeted in March, domestic producers and Republican lawmakers turned to the administration that’s proven itself a loyal ally of fossil fuels. BHFS client API, which represents hundreds of members in the oil and gas sector, requested regulatory relief in a letter to the White House.
In a pair of letters in late March and early April, more than 70 members of Congress, mostly Republicans who have received large donations from the fossil fuel industry over their political careers, called on the Trump administration to throw oil a lifeline by reducing or eliminating royalties ― payments that oil and gas companies make to the federal government to extract oil and gas from public lands and waters.
And more than a dozen Republican senators sent a letter to de facto Saudi ruler Crown Prince Mohammed bin Salman in mid-March urging him to stabilize the turbulent market. When the Saudi government stayed its course, Sen. Ted Cruz (R-Texas), one of the letter’s signees, accused the kingdom of “engaging in economic warfare against the United States” in an effort to “drive a bunch of American producers out of business.”
In early April, Saudi Arabia and Russia agreed to cut oil production, bringing an end to the price war after a month. The announcement came roughly a week after Trump told Crown Prince Mohammed by phone that failing to end the standoff would likely result in Congress passing legislation to withdraw all U.S. troops and missile defense systems from Saudi Arabia, Reuters reported.
Republican Sens. Kevin Cramer (N.D.) and Dan Sullivan (Alaska) introduced that legislation, dubbed the “Strained Partnership Act,” on March 24. The following day, Ari Zimmerman, one of several BHFS policy advisers who lobbies on the Saudi government’s behalf, met with Cramer to discuss the bill, the latest filing under the Foreign Agents Registration Act shows. That discussion appears to have done little to deter Cramer from publicly slamming the kingdom.
“Saudi Arabia has shown indifference, if not malintent, for American energy producers during its feud with Russia,” he said in a March 27 statement, a little less than two weeks before the two countries struck a deal to cut production. “These are not the actions of a supposed ally or friend, and they will not be tolerated.”
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