If the United States does not lift its 40-year ban on crude exports, Iran could soon be competing in global markets that would be mostly shut to U.S. oil companies, a report prepared for the head of the Senate energy committee said on Tuesday.

The United States and five other global powers could reach a deal with Tehran over its nuclear program in early July. If a deal is reached, the OPEC member could be producing significantly more oil by the end of 2016, pushing down global crude prices.

The United States is in the midst of a six-year oil boom, but Washington has banned most crude exports since the Arab oil embargo of the early 1970s sparked fears of shortages.

"The general prohibition on exporting domestic crude oil amounts to a de facto sanctions regime against U.S. producers," the report by Senator Lisa Murkowski's staff said.

In the absence of lawmakers passing a bill to overturn the ban, or President Barack Obama relaxing the trade restriction, a return of Iran to the oil market "would grant Iranian oil producers access to global markets but deny it to American producers."

The report called "Cross-Currents: Iranian oil and the U.S. export ban" pointed out that American crude is not a "perfect" replacement for Iranian oil. "However, U.S. shipments of certain grades could be competitive under the right economic conditions."

Murkowski, a Republican, has introduced a bill to overturn the ban this year, but it is uncertain whether it will get the 60 votes needed to pass.

By Reuters