Japanese fishermen took part in efforts to clean up an oil spill in a major Tokyo waterway Thursday as the search continued for eight Chinese missing after two cargo ships collided.

The Panamanian-flagged Beagle III, a 12,630-ton vessel carrying steel coil, sank early Tuesday after colliding with the South Korean-registered Pegasus Prime in the mouth of Tokyo Bay.

Twelve of the 20 Chinese crew aboard Beagle III were rescued but one of them later died.

"We are continuing our search but the fate of the eight missing Chinese crew members remains unknown," a Japanese coastguard official said.

Oil seeping from the ships had spread across large areas of the Uraga waterway and to the shore, raising concerns over the impact on the environment and local sea life, the official said.

Television footage showed officials and dozens of fishermen cleaning up the mess in Chiba, south of Tokyo, in rainy conditions.

The sunken Beagle was believed to be carrying some 400 tons of fuel when the accident happened.

A survey ship has detected an object that could be the sunken vessel about 100 metres (328 feet) down on the sea floor.

The crew of the 7,406-ton Pegasus Prime -- six South Koreans and eight people from Myanmar -- were mostly unhurt.

The sea was not believed to be rough at the time of the collision, according to the coastguard.

Tokyo Bay is Japan's busiest waterway with some 500 ships passing through daily.