Cutter stock is any stream that is blended to reduce the viscosity of the resulting blend. Cutter stock is commonly used in fuel oil blending. Fuel oil tends to be a sink for high-viscosity resid that must be offset by blending lower-viscosity material to meet the viscosity specification of the fuel oil.
Common cutter stocks for fuel oil blending are LCO and kerosene. These cutter stocks are significantly more valuable than the resulting fuel oil blend, so this loss of value translates into a significant cost of meeting the viscosity specification of the fuel oil. Therefore, refiners look for all ways possible to minimize the amount of cutter stock in the finished blend while still producing on-spec fuel oil.