The sewer (and everything in it) is a disfigured and dying version of everything good in his life before the split with his wife. All the flashbacks in the film are likewise done though bright, colourful paintings, a contrast from how his work looks now.
Throughout the film, whenever the artist is overcome with sorrow, his eyes glaze over and he tries to cope with his feelings through his paintings, as he appears unable to otherwise. Before he starts stabbing his mermaid, his eyes glaze over once again, but he has already finished his perfect painting, and with no outlet for his anguish, becomes enraged and psychotic.
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