Benchmark January palm oil futures on the Bursa Malaysia Derivatives Exchange traded 1.3 percent higher at 2,990 Malaysian ringgit ($955) a tonne, after having earlier touched 2,995, a high not seen since Sept. 23.

Traded volumes for the January palm contract stood at 5,788 lots of 25 tonnes each, compared with 14,264 lots on Tuesday, before Wednesday's holiday in Malaysia for the Hindu Diwali festival of lights.

"3,000 is not far from here," said a Kuala Lumpur-based trader. "The monsoon weather (season) is in play, and a supportive external market and higher crude oil."

Euro zone leaders struck a deal with private banks and insurers on Thursday for them to accept a 50 percent loss on holdings of Greek government bonds as part of a plan to lower Greece's debt burden and try to contain the two-year-old euro zone crisis.

A slowdown in Europe, the second-largest palm consuming region after Asia, could weaken demand, although palm oil could maintain its market share in the region as it is the cheapest edible oil.

Reuters technical analyst Wang Tao said a bullish target at 3,014 ringgit was intact for palm oil, and a rise above this level would open the way towards 3,133 ringgit.

Crude oil rose by more than a dollar after European leaders agreed to boost the region's rescue fund, raising hopes the euro zone debt crisis will be contained.

Also aiding palm oil sentiment on Thursday were lower production expectations due to the rainy season in dominant Southeast Asian producers.

A weaker version of La Nina may reappear this year, but still triggering above-normal rainfall in Southeast Asia and eastern Australia.

"Going into the last quarter of the year, prices have a lot of room to move up," said a Singapore-based analyst. "This is on the back of slowing CPO production growth ... everyone is also looking to the South American (soybean) harvest."

"The euro zone is a driver of positive sentiment in the commodities scene but there will still be a lot of volatility," he said on sovereign debt problems, adding that palm prices could now rise 10 percent by the first quarter of 2012.

At the same time, demand looks robust, with data earlier this week showing Malaysian exports rose around 15 percent for Oct. 1-25.

In comparative markets, US soyoil for December delivery gained about 2 percent in Asian trade, while China's most active May 2012 soybean oil contract also rose.