NY Dem Invested in Iran’s Biggest Oil Customer

Republican calls on Sean Eldridge to divest from Chinese company

Democratic candidate for Congress Sean Eldridge / AP
June 9, 2014

A Democratic House candidate is under fire for his husband’s sizable investment in a Chinese oil company that does extensive business in the Iranian oil sector.

Facebook cofounder and poke button pioneer Chris Hughes, the husband of New York Democrat Sean Eldridge, owns between $100,000 and $250,000 of stock in China Petroleum and Chemical Corp., according to disclosure forms released last week.

That company’s activity in Iran spurred Rep. Chris Gibson (R., N.Y.), Eldridge’s opponent, to call on him to divest from those holdings.

Hughes’ stake in the company "impacts our country's national security," Gibson said in a news release on Monday.

"The company Sean is invested in provides Iran with continued access to capital and markets in the face of sanctions imposed by the United States and its allies across the world," Gibson said.

The Chinese company in which Hughes is invested is the largest petroleum refiner in Asia. It is also one of the largest purchasers of Iranian crude oil.

"Today, I am calling on Sean Eldridge to divest from China Petroleum & Chemical Corp.," Gibson said. The investment "shows poor judgment for a candidate who says he is ready to serve as a congressional representative and make decisions that impact our country's national security."

Gibson, an Army veteran, has accused Eldridge of using his husband’s fortune to "buy" a congressional seat. Last week he also criticized Eldridge for Hughes’ investments in companies that extract oil and gas through hydraulic fracturing, an innovative oil and gas technique that Eldridge vocally opposes.

Many of those investments were actually made by Hughes, not Eldridge, but Gibson’s campaign says that is a distinction without a difference.

"Federal law recognizes the inextricable link between candidate and spouse assets, therefore requiring public disclosure of both," campaign spokeswoman Stephanie Valle said in an email. "Sean can use the profits from either his or his husband's investments to fund his campaign directly or indirectly."

The Gibson campaign has alleged that he is doing so indirectly, using a venture capital firm to invest in local businesses as a way of "buying" good will in a district where he and Hughes have only lived for two years.

The campaign took another shot at Eldridge’s fortune in its Tuesday statement, saying he is "using the investments to buy homes to run for Congress from and finance his campaign."

Other energy investments may also fuel criticism of Eldridge and Hughes’ portfolio. In addition to his investments in American oil companies, Hughes owns a stake worth between $15,000 and $50,000 in Russian oil giant Lukoil.

The company calls itself "the leader of the Russian oil industry in exploration, production, refining, and marketing of petroleum products."

Lukoil gas stations in the United States have been targeted by protests since Russia’s invasion of Crimea. Experts say the Kremlin frequently uses its dominance over the nation’s energy sector to assert itself internationally, including during the aftermath of the invasion.

The Eldridge campaign did not respond to a request for comment by press time.