The S&P/ASX200 rose 26.3 points on Wednesday, up 0.31 per cent, to 8,640.6, as the broader All Ordinaries gained 28.3 points, or 0.32 per cent, to 8,847.7.
Oil prices faded by 2.4 per cent during the session, after Iraqi and Kurdish authorities agreed to resume crude exports via Turkey's Ceyhan port, providing an alternative to the effectively halted Strait of Hormuz.
"I really don't feel like the ASX200 has got a lot of potential to get back up much higher than 8760 to 8770 … until we get some sort of resolution about what is going to play out in the Middle East," IG market analyst Tony Sycamore told AAP.
"It feels like a bit of a parting of the storm clouds, but I just don't know how far away the return of those storm clouds is at this point in time."
Ten of 11 local sectors ended the session higher, led by IT and real estate stocks as swap markets softened their bets on a May rate hike following a surprisingly close RBA board vote to lift the cash rate on Tuesday.
Energy stocks gained 0.7 per cent, with much of the strength coming from coal producers and some modest gains from uranium stocks.
Oil and Gas giant Woodside traded slightly better than flat as it named Liz Westacott as CEO and managing director, in a widely expected appointment.
Santos gained 0.8 per cent, despite news the Australasian Centre for Corporate Responsibility is appealing a Federal Court decision that cleared the explorer of greenwashing in investor communications.
Basic materials stocks rose 0.5 per cent, with decent leads from BHP and Rio Tinto, as iron ore futures hovered near two-month highs.
BHP has announced Brandon Craig will replace Mike Henry at the helm after more than six years in the top job.
Gold miners were sluggish as the precious metal fell to $US4,990 ($A7,013) an ounce, with investors cautious ahead of a Federal Reserve interest rate decision due overnight on Wednesday.
In financials, CommBank and Westpac carved out gains, while NAB and ANZ dragged after Morgan Stanley flagged potential earnings downgrades for the sector due to ongoing economic uncertainty.
Commonwealth Bank's share price would likely be the most resilient, researchers said, while NAB was the most exposed to slowdown scenarios.
Health care stocks made up the only sector to end the day lower, sliding 0.7 per cent as blood plasma giant CSL tumbled more than two per cent, despite inking some favourable deals for its CSL Seqirus arm this week.
In company news, metals recycling group Sims rocketed 9.9 per cent higher on the back of an earnings upgrade, thanks to price strength in non-ferrous metals and chip memory markets.
Droneshield performed even better, up more than 10 per cent and beating out the top-200, as the US Pentagon flagged plans to dramatically increase attack drone production.
ARN Media shares dipped 1.5 per cent to 33.5 cents on news the group terminated Kyle Sandilands' $100 million contract after pulling Kyle and Jackie O radio show off the air.
The Australian dollar is buying 71.19 US cents, up from 70.61 US cents on Tuesday afternoon.
ON THE ASX:
* The S&P/ASX200 rose 26.3 points, or 0.31 per cent, to 8,640.6
* The broader All Ordinaries gained 28.3 points, or 0.32 per cent, to 8,847.7
One Australian dollar trades for:
* 71.19 US cents, from 70.61 US cents at 5pm AEDT on Tuesday
* 112.97 Japanese yen, from 112.60 Japanese yen
* 61.65 euro cents, from 61.55 euro cents
* 53.24 British pence, from 53.19 British pence
* 121.31 NZ cents, from 121.29 NZ cents
