The choice of Gregg, a fiscally conservative lawmaker from New Hampshire, could help Obama soften resistance from Republicans opposed to the terms of an $800 billion-plus economic stimulus package the new president is trying to push through Congress.
New Hampshire's Democratic governor, John Lynch, may name a Democrat to replace Gregg, which could give the party 60 seats in the 100-seat Senate, enough to clear Republican procedural hurdles and give Obama a clearer path for key legislation.
"Senator Gregg is now the leading candidate for Commerce and a pick that could come as early as Monday," an administration official said, speaking on condition of anonymity.
Gregg, a third-term senator and the ranking Republican on the powerful Senate Budget Committee, confirmed Friday that Barack Obama could nominate him to head the Commerce Department.
"I am aware that my name is one of those being considered by the White House for secretary of commerce, and am honored to be considered, along with others, for the position," Gregg said in a brief statement.
White House press secretary Robert Gibbs said Friday Obama would pick a commerce secretary within days but that a final decision had not been made.
Gregg, a former Senate Budget Committee chairman, helped the two parties reach a deal last year on a Wall Street bailout, and could play a major role in striking up the kind of bipartisanship that Obama has promised in Washington.
In early January, Obama's first pick for commerce secretary, New Mexico Governor Bill Richardson, withdrew as his nominee in the face of a legal inquiry. Richardson denied any wrongdoing in connection with the probe of a California-based financial company that had done business with the New Mexico state government.
But he said an investigation lasting possibly weeks or even months "would have forced an untenable delay in the confirmation process."
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