The 1,100-dwt Sun Birdie (built 1993) was reported missing on Thursday morning after the owner lost contact on Wednesday night.
The ReCAAP reporting centre said its last known position was one nautical mile south of Tanjung Ayam.
The vessel was laden with 700 tonnes of fuel oil and carries 11 crew: eight Myanmarese and three Indonesians.
Late on Thursday night the ship was sighted and recovered by the Malaysian Maritime Enforcement Agency (MMEA) 17.6 nautical miles northeast of Tanjung Penawar.
The vessel's crew was detained along with seven pirates found on board.
Two attackers jumped overboard and fled.
They were picked up by a passing ship five miles away.
ReCAAP commended MMEA for "displaying utmost agility and efficiency in recovering the tanker and arresting the perpetrators on board."
The tanker is operated by Teguh Samudera of Malaysia.
