UPDATE 3-US senators drop objections to Obama's CFTC nominee
* Sanders, Cantwell lift holds on Gensler CFTC nomination
* Sanders reassured by Gensler in meeting
* Cantwell still has reservations but looking ahead
* White House looks forward to confirmation (Adds quotes from Cantwell, White House)
WASHINGTON, May 14 (Reuters) - Two U.S. senators dropped their objections on Thursday to Gary Gensler becoming chairman of the Commodity Futures Trading Commission, clearing the way for a Senate vote on his long-delayed nomination.
Democratic leaders were likely to move swiftly to confirm Gensler, who was nominated by President Barack Obama on Dec. 18 to head an agency that will play a key role in administration efforts to tighten financial regulation.
In the Senate, individual lawmakers may place holds on administration nominees. Gensler, who was U.S. undersecretary of the Treasury from 1999 to 2001 and assistant secretary of the Treasury from 1997 to 1999, had been blocked for months by senators Bernie Sanders and Maria Cantwell.
Both lawmakers dropped their holds within hours of each other on Thursday, the day after the administration unveiled a proposal to reform the over-the-counter derivatives market -- a task in which the CFTC will be deeply involved.
White House spokesman Reid Cherlin said the president "welcomes today's news and looks forward to Mr. Gensler's swift confirmation."
Sanders, an independent from Vermont, announced his decision in a statement, saying he was encouraged by the administration's OTC crackdown proposal and by reassurances made to him by Gensler in a meeting on Thursday.
"The commitments I received from Mr. Gensler along with President Obama's strong plan to regulate financial markets demonstrate the administration's determination to make sure that the financial mess that we are in never happens again," Sanders said.
He said Gensler pledged to address "regulation of hedge funds, making sure that banks are not allowed to manipulate the price of heating oil and crude oil, and preventing the enormous conflicts of interest that exist in energy markets."
Gensler would oversee an agency heavily criticized by lawmakers for failing to rein in runaway speculation that sent oil and commodity prices to record highs last year. Commodity prices have fallen sharply since then, but lawmakers still want to beef up the CFTC and other regulatory bodies in case prices take off again.
Cantwell, a Democrat from the state of Washington, announced her decision on the Senate floor after discussing the matter with the White House.
"I continue to have concerns about Mr. Gensler's appointment," said Cantwell. "But in light of the administration's significant and potentially historic stand on new controls over derivatives markets, I am prepared to lift the hold on his confirmation and focus on ensuring that the legislation we pass gets the job done."
The Senate Agriculture Committee in March approved Gensler, a former Goldman Sachs executive.
Gensler has come under fire for his role, as a high-level Clinton administration Treasury official, in developing a 2000 law that exempted the $58 trillion credit-default-swap market from oversight. Those financial instruments have been blamed for worsening global financial turmoil. (Addition reporting by Christopher Doering; Editing by Leslie Adler)
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