Asian markets enjoyed another day of gains Thursday as energy firms tracked a surge in oil prices, while fears over Syria and a possible China-US trade war eased.
Fresh hopes that Donald Trump and North Korea's leader Kim Jong Un will hold a historic summit within months also provided some much-needed optimism.
Both main crude futures rallied almost three percent Wednesday on the back of data showing a drop in US stockpiles -- indicating improved demand -- and expectations that a Russia-OPEC output cap deal will be kept in place.
Adding to the gains was talk that OPEC kingpin Saudi Arabia wanted to see crude at around $80 a barrel as it prepares for a gigantic listing of part of its state oil company. Tensions in the oil-rich Middle East are also keeping prices elevated.
Brent and WTI, which are now sitting at levels not seen since the end of 2014, edged up further in Asia.
Energy firms across the region were boosted, with Hong Kong-listed PetroChina up 5.7 percent and CNOOC 4.4 percent higher. Woodside Petroleum added one percent in Sydney and Inpex put on a similar amount in Tokyo.
"That surprise draw on inventories in the US appears to have changed the game despite the fact that we did see an increase in US production. The market has looked past that," said Michael McCarthy, an analyst at CMC Markets in Sydney.
"With that increasing demand and some concerns about (the) supply side, a number of traders have been blindsided by this recent move."
On equity markets, Tokyo ended 0.2 percent higher, while Hong Kong and Singapore each gained more than one percent and Shanghai added 0.8 percent. Sydney and Seoul both climbed 0.3 percent.
Taipei, Wellington and Jakarta were also higher.
In early European trade London and Paris each rose 0.2 percent but Frankfurt dipped 0.1 percent.
The positive trading environment is a far cry from the unease felt at the start of the week after US-led strikes on Syrian targets -- in response to an alleged chemical attack -- sparked worries of a confrontation with Russia, which is an ally of the Damascus regime.
- Trade, Syria risks ease -
However, reports have suggested Russian President Vladimir Putin is looking to ease tensions as he faces fresh sanctions.
China's announcement of a timetable to remove restrictions on foreign ownership in its car market, the world's biggest, also lifted optimism that a simmering trade war with the United States can be avoided.
Tough rules on doing business in the country's auto sector had been a major source of anger for Trump, who has already threatened tariffs on billions of dollars of Chinese imports in recent weeks as part of his "America First" protectionist agenda.
However, in its quarterly report on the US economy, the Federal Reserve warned there were concerns about the trade tensions among businesses and farmers, who had seen prices rise already.
The central bank's Beige Book report said the world's top economy continued to see moderate growth and it expected to lift interest rates twice more this year, having already hiked them in March.
"The biggest dynamic in the market right now is the growth story," Sandip Bhagat, chief investment officer at Whittier Trust, told Bloomberg TV.
"We're in the midst of a synchronised global recovery in growth and corporate profits are rising," he added. Trade wars, tariffs and inflation worries are just "distractions".
On currency markets, the pound struggled to bounce back against the dollar after diving from post-Brexit vote highs on data showing a surprise drop in British inflation.
And the upbeat sentiment across markets has provided support to the greenback against the safe haven yen.
- Key figures around 0810 GMT -
Tokyo - Nikkei 225: UP 0.2 percent at 22,191.18 (close)
Hong Kong - Hang Seng: UP 1.4 percent at 30,708.44 (close)
Shanghai - Composite: UP 0.8 percent at 3,117.38 (close)
London - FTSE 100: UP 0.2 percent at 7,331.50
Euro/dollar: DOWN at $1.2373 from $1.2379 at 2100 GMT
Dollar/yen: UP at 107.46 yen from 107.23
Pound/dollar: DOWN at $1.4194 from $1.4205
Oil - West Texas Intermediate: UP 57 cents at $69.04 per barrel
Oil - Brent North Sea: UP 66 cents at $74.14 per barrel
New York - Dow: DOWN 0.2 percent at 24,748.07 (close)