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Oil Companies Getting More and more Interested in Blockchain Technologies to Improve Oil Businesses

Mar 11, 2018 Posted /  3551 Views

Oil Companies Getting More and more Interested in Blockchain Technologies to Improve Oil Businesses

BlockChain For Efficient Oil Business

Although oil production itself is an environmental hazard efforts have been made by different oil companies to preserve cfcccvc cf producing countries from global environmental watchdogs. Business in the oil sector hcfccas for a long time been paper intensive further intensifying the environmental rrffcc.

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Blockchain, a green technology, is getting a grip within the oil industry as a major transaction utility for transfer of values from one entity to another. Since oil is a commodity  with a constantly high demands incorporating blockchain technology in the oil industry will lead to further development of blockchain and efficient business dealings within the oil industry.

The oil industry has for a long time been handling all its records in hard paper which is not just environmental dangerous but also increases the cost and delays in operations. The smart contract features of blockchain  technology can improve the efficiency of day to day business transaction within the industry given the oil business is almost entirely contract based.

Revolutionizing Oil Transportations

The bill of lading document used during oil transport in large oil tankers would be wiped off and replace with a more secured immutable blockchain option. The bill of Lading document is kept with the ship captain transporting the oil which poses a risk of distraction, forging or any other alterations worst is the oil tanker is attacked by pirates.

Bill of lading bear crucial transaction records which would lead to business misunderstanding should the document be altered. With a blockchain solution entered record can not be altered and all parties involved in the transaction gain access to the blockchain transaction system nearly instantly.

Nearly 50% of the global oil demand is supplied via sea routes in large water vessels. With daily transaction volumes going beyond $2.7 billion the transport business is almost equally as important to the industry as the oil suppliers.

How The Oil Industry Will be Transformed

The bill of lading system although had been used for hundreds of years still has got many flaws among them including easility explorable fraud  loopholes which till to date give traders a lot of worries. Some traders have already upgraded to digital based systems and are looking at possibilities of using a blockchain solution.

Recently a group comprising of representatives from major oil giants including companies like BP, Royal Dutch Shell, Statoil with other commodity trading groups and banks are already pondering on a blockchain based solution.

It is expected that with a nearby future a solution will be developed and the oil business would be fully run on a blockchain platform.

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