Add the chicken pieces to a medium bowl, along with the cornstarch, water, oyster sauce, and 1 tablespoon of oil.
Heat a large skillet over medium high heat. When hot, add the remaining 2 tablespoons of oil. Sear the chicken pieces in the skillet until browned. Remove from the pan and set aside.
If there are a lot of chicken bits stuck to your pan, deglaze with a little water. Then add the sliced onions and cook until translucent. Add the curry paste and cook for 5 minutes.
Add the vegetables and cook for another 2 minutes. Add the coconut milk, chicken stock, and the seared chicken pieces. Bring to a simmer and lower the heat. Cover and simmer for 8 minutes. After the curry has finished simmering, stir in the sugar, fish sauce, and basil. Serve with steamed rice.