The S&P/ASX 200 index closed up 0.9% at 6,613.2 points. The benchmark fell 0.3% on Wednesday.

Oil prices, which had risen more than 4% overnight and dipped slightly in early Asian trade, rebounded after China and the United States agreed to hold high-level trade talks in early October in Washington.

China's commerce ministry also said its trade team will consult with their U.S. counterparts in mid-September in preparation for the meeting.

Leadings gains on the benchmark index, energy stocks jumped 1.4%, with its biggest player Woodside Petroleum marking its best day in over 2 months, while engineering services provider WorleyParsons added 4.1%.

Financial stocks also provided a boost to the local benchmark, rising 1% to a more than three-week high. The country's "Big Four" banks gained between 0.7% and 1.1%.

But Australian-listed shares of British lender CYBG Plc  slumped 20.3%, making it the top decliner on the benchmark index, after the company said it expected to increase provisions for legacy payment protection insurance costs.

The mining sector closed marginally higher as gains were capped by a 0.7% fall in shares of BHP Group, the mining sub-index's largest constituent and the country's biggest firm by market value, as it traded ex-dividend.

Amid an overall improvement is risk appetite, gold miners  lost their sheen due to the reduced safe-haven demand for the precious metal.

Top gold miners Newcrest Mining and St Barbara  shed 0.7% and 2.2%, respectively.

Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index advanced 0.9% to finish at 11,106.67.

Electricity retailer Meridian Energy and Vital Healthcare Property Trust were the top performers on the benchmark, strengthening 3% each.