The MT Orkim Harmony, which had 6,000 tonnes of petrol in its hold and 22 crew aboard, has been given fresh touches of paint and had its name altered to "Kim Harmon", according to photos released by Malaysia's navy.
A patrol vessel was now shadowing the tanker and communicating with its hijackers in a bid to secure their surrender, Royal Malaysian Navy chief Admiral Abdul Aziz Jaafar said on his Twitter feed.
"All crew are safe and unharmed."
The vessel was in Vietnamese waters, about 200 nautical miles (370 kilometres) northeast of the Malaysian city of Kota Bahru, officials said.
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The Malaysian-registered tanker is the latest victim of increasingly brazen pirates behind an upsurge in hijackings in Southeast Asia in the past two years.
The typical targets are usually tankers carrying valuable petrol, diesel or gas oil.
Officials have estimated the value of the MT Orkim Harmony's cargo at 21 million ringgit (USD 5.6 million). Its crew includes 16 Malaysians, five Indonesians and a Myanmar national.
The vessel was spotted Wednesday by a search-and-rescue operation, officials said.
The London-based International Maritime Bureau (IMB) has repeatedly warned that the waters of Southeast Asia were becoming the world's piracy hotspot and called for decisive regional action to thwart attacks.
Pirates are preying on slow-moving small coastal tankers, with one attack occurring every two weeks, the IMB said recently.
Pirates usually syphon off cargoes to other vessels before later releasing the tankers and crews.
Asked whether authorities might storm the vessel, he told reporters in Malaysia's administrative capital of Putrajaya, "our options are open," but he later suggested the navy preferred to take the hijackers alive.