okay, so some basics
when you eat carbs they get broken down through the digestive process into glucose, fructose, and galactose, with about 80% being glucose. Insulin, which is a peptide, is the main transport mechanism for glucose. So the more carbs you eat the more insulin is required to transport the glucose into the cells to provide energy. Once the glucose has been transported into the cell depending on the energy requirements it is either burned off or undergoes further metabolic processes in terms of storing it for future use, this is done by conversion into long fatty acid chains and storage as fat in the cells in the form of triglycerides (this is in very simplistic terms). Whilst fatty acids can pass through the cell membrane triglycerides can't unless they are broken down by other hormones and processes.
in short when insulin is secreted, or the level of insulin in the circulation is abnormally elevated, fat accumulates in the fat tissue. When insulin levels are low, fat escapes from the fat tissue, and the fat deposits shrink.
However, raised insulin levels (as occurs through excess intake of carbohydrates) suppress the production of hormones required to break down triglycerides and thus prevent the fat from flowing back out of the cell to be used as energy.
So by reducing or cutting carbs out of your diet your insulin levels stabilise and the body can start using the stored fat as fuel.
Your body will always default to using carbs first as a fuel source, then fats and finally proteins
