The master of MT Bunga Kelana 3 estimated that 2,000 tonnes of oil could have spilled into the sea.
The tanker was carrying Bintulu light crude and condensate, Paul Lovell, head of corporate communications at AET Tanker Holdings Sdn Bhd. AET, which owns and manages the vessel, said.
"She was carrying two types of cargo, some condensate and some very light crude, it was about 40 per cent condensate and about 60 per cent light crude on the vessel at the time of the incident," he said.
"It looks as though the spill would have been from the very light crude, the exact amount I can't tell you."
Following the collision, the authorities have dispatched four patrol and emergency response craft to the affected area.
They have also activated oil spill response companies which have deployed three craft equipped with oil spill equipment.
"Work is ongoing to contain and clean up the oil spill," the statement said.
Both vessels are currently anchored in the Singapore strait.
MV Waily is currently about 11km southeast of Changi East and MT Bunga Kelana 3 is about 7km south of Changi East.
Malaysia's largest shipping company, MISC, a unit of state-run oil company Petronas, lists the Bunga Kelana 3 as an Aframax class tanker built in 1998.