The MT Sunrise 689 went missing en route from Singapore to the Vietnamese port of Quang Tri, falling out of contact shortly after it left port a week ago.
"The Sunrise and its 18 crew members were released early this morning by pirates who took around a third of cargo on board," Nguyen Nhat, the director of Vietnam's Maritime Department, told AFP today.
"Around a dozen pirates with guns jumped on the ship, took control and beat the crew," said Nhat, who had spoken to the ship's captain Nguyen Quoc Thang early today after their release.
Southeast Asia has seen a spate of daring hijackings this year, centred on the Strait of Malacca running between Malaysia, Indonesia and Singapore.
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The incidents have fanned fears that the region's busy shipping lanes - plagued by piracy for centuries - could once again become a problem area after an earlier surge in sea banditry was largely suppressed by regional navies.
The Sunrise, which belongs to a shipbuilding company in the northern Vietnam port of Hai Phong, was carrying more than 5,200 tons of oil and 18 crew, state media reported.
The ship is heading towards Vietnam's southern Phu Quoc island, where is it expected to arrive around midday today, Nhat said.
The International Maritime Bureau's Piracy Reporting Centre in a statement confirmed that the "crew and vessel are safe and proceeding to a safe port in Vietnam".
Most recent piracy attacks have involved tankers whose cargo of oil or fuel have been siphoned off to other vessels. There have been no reports of deadly violence.
In recent years, global concern over piracy has focused on attacks by trigger-happy Somali pirates off East Africa.