The benchmark Korea Composite Stock Price Index (KOSPI) ended up 0.10 percent at 972.56, its highest close since finishing at 976.05 on February 9, 2000.
"Stronger oil prices and a firmer won looks like being a trend again, but the market hasn't been taken aback as it was late last year," said Kim Jun-nyun, a fund manager at Chohung Investment Trust Management.
US crude futures rose 2.3 percent to $48.44 a barrel on Wednesday amid worries about an Opec output cut this spring. Oil was trading at $48.56 a barrel in Asia.
The spike in oil prices lifted SK Corp, South Korea's top oil refiner, 4.69 percent to 55,800 won, while third-ranked S-Oil Corp closed up 4 percent to 64,900 won.
However, concerns that higher energy prices would cut into corporate profits had a heavy impact on exporters and air carriers. South Korea is the world's fourth-biggest crude oil buyer and has to import all of its crude needs.
Shares in South Korea's biggest carmaker, Hyundai Motor Co, fell 1.76 percent to 55,700 won, while Samsung Electronics Co Ltd, the world's top maker of memory chips, fell 0.58 percent to end at 517,000 won.
South Korea's biggest carrier, Korean Air Co, ended down 1.81 percent at 19,000 won, hit by concerns higher fuel costs would erode its earnings. Smaller rival Asiana Airlines Inc fell 1.6 percent to 4,300 won.
Kumho Tire, which listed both in London and Seoul, received a warm welcome on its debut as analysts were generally bullish on its shares, citing brisk exports and a hefty rise in sales prices among other factors.
Kumho's $363 million IPO was South Korea's biggest since LG.Philips LCD Co Ltd raised $1 billion in New York and Seoul in July last year.