Since starring during Argentina's World Cup triumph and winning the Young Player of the Tournament award, Fernandez has been linked with a number of other European clubs.
However, with it soon becoming apparent that Benfica would sell for no less than a release clause of €120m (£105.62m), the majority of teams opted against making an approach in January.
Chelsea remained interested, and it was widely claimed at the end of 2022 that the Blues owners were willing to pay in excess of the release clause in order to avoid shelling out Benfica's fee up front.
Furthermore, Fernandez has only recently returned to Portugal after allegedly being provided with 'a special permit' to return to his homeland, and he also played in Benfica's 3-0 defeat to Braga over Christmas.
Despite that appearance, it has since been claimed that he is eager to join Chelsea, just five months since making his debut for Benfica.
According to Record, the 21-year-old told head coach Roger Schmidt on Tuesday that he wanted to link up with the Premier League club, and this has seemingly led to further developments.
The same outlet says that Costa is ready to agree a deal with Chelsea and has given permission for Fernandez's agent Jorge Mendes to negotiate with Chelsea.
Personal terms for Fernandez are not expected to be an issue, with the onus likely to be on the structure of the financial proposal that Chelsea arrange with Benfica.
The hierarchy at the West Londoners are allegedly keen on spreading the payment across three years in order to continue to meet FFP criteria.
Nevertheless, if the reported €127m (£111.78m) proves to be correct, it will be a club record for a player who cost €18m, including add-ons, in June and has made just 25 appearances for Benfica.
Chelsea's owners are showing no signs of any let-up when it comes to spending, with the transfer of David Datro Fofana having already been completed and Andrey Santos and Benoit Badiashile expected to complete transfers in due course.
A new right-sided defender is also expected to arrive with Chelsea requiring more competition in that area due to Reece James's injury issues and club legend Cesar Azpilicueta now 33 years of age.