(New York, N.Y.) – As Malaysia’s Foreign Minister Mohamad Hasan arrives in Washington, D.C. to attend a ministerial meeting and advance Malaysia–U.S. bilateral cooperation, another urgent issue risks being overlooked: the growing impunity enjoyed by the ghost fleet operating in Malaysian waters.

In 2025, ghost fleet tankers, most of which are identified on the United Against Nuclear Iran’s (UANI) Ghost Armada list, transported $45.7 billion worth of sanctioned oil from Iran to buyers in China. Their business model requires conducting ship-to-ship (STS) transfer operations in the waters inside Malaysian Exclusive Economic Zone (EEZ). They sail daily via the Malacca Strait and anchor without scrutiny in the waters off Eastern Johor, Malaysia, in the South China Sea, with total impunity.

Using satellite imagery, UANI confirms that on January 11, 2026, approximately 60 ghost fleet tankers linked to Iranian oil shipments were present in the East Outer Port Limits (EOPL) off Malaysia. These vessels were observed at this anchorage, likely preparing for STS transfers to other vessels bound for China. Such STS transfers, one of the hallmarks of illicit oil smuggling, continue to take place with alarming frequency in these waters.

Last year, Foreign Minister Hasan himself acknowledged that the STS issue is a “thorn in our side,” conceding that Malaysia is often accused of allowing illegal oil transfers to take place in its waters. Yet, despite last year’s pledge to implement new regulations to strengthen enforcement against such activities, illegal STS operations remain largely unchecked.

UANI Chairman Governor Jeb Bush and CEO Ambassador Mark D. Wallace said the following: 

“Ghost fleet tankers carrying Iranian oil are operating with impunity just offshore Malaysia. An increasing number of STS transfers are taking place in these waters, and Malaysia’s enabling of Iran’s illicit oil trade must come to an end.

“These illicit oil sales to China are a primary financial lifeline for Tehran, funding the Iranian regime’s destabilising activities across the region, including its nuclear, missile, and drone programs as well as Tehran’s domestic repression.

“UANI is concerned that, despite Malaysia’s recent announcement of the arrest of the EU-sanctioned oil tanker RCELEBRA (IMO 9286073) off Penang following its STS exchange of Iranian crude with OFAC-sanctioned tanker NORA (IMO 9237539) 24 nautical miles off the Malaysian coastline, this enforcement action was short‑lived and ultimately reversed. This isolated action ultimately amounts to little more than a symbolic gesture unless accompanied by comprehensive enforcement targeting the true STS hotspot in the EOPL.

“As discussions in Washington continue, Malaysia must also demonstrate that it will not enable Iran’s sanctions-evasion network through continued tolerance of the ghost fleet’s operations. Cooperation with the U.S. is important, but so too is principled enforcement against those who violate international law in Malaysian waters. It is time to consider meaningful sanctions on Malaysian facilitators to address their facilitation of Iran’s illicit oil exports.”