Blockchain and big oil are together at last, reports Real Money. London-based blockchain startup VAKT is tackling the global supply chain of big oil companies using the distributed ledger technology and counts Royal Dutch Shell, Equinor, and BP among its first customers. Blockchain will be implemented for contract tracking and management.
"Launching into our first market with such high-caliber first users is a transformational moment for us and the industry," VAKT CEO John Jimenez said in a press release. "But it's just the start: success for a blockchain solution depends on widespread adoption and we're looking forward to seeing the ecosystem grow."
"Collaboration with our peers and some of the industry's key players is the best way to combine market expertise and achieve the scale necessary to launch a digital transaction platform that could transform the way we all do business."
"Digitalisation is changing how the energy value chain works. It's an exciting time," Andrew Smith, EVP Trading & Supply, Shell International Trading and Shipping Company Limited, stated in the press release. "Collaboration with our peers and some of the industry's key players is the best way to combine market expertise and achieve the scale necessary to launch a digital transaction platform that could transform the way we all do business. Ultimately the aim is improved speed and security, which benefits everyone along the supply chain from market participants to customers."
As Real Money notes, the adoption of blockchain in supply chain management for other industries likely piqued big oil’s interest in the emerging technology.
Kevin Werbach, University of Pennsylvania's Wharton School of Business professor and noted blockchain expert, explained blockchain’s appeal to Real Money. "Any time there is a collection of actors that need to work together but don't trust each other, that creates a trust gap, they all want to keep control of the data," Werbach said. "That leads to all kinds of errors and inefficiencies.”
Big oil senses an opportunity to eliminate issues in their supply chain such as inefficiencies and foul play and save massive costs from fraud reduction and streamlined operations over time.
"This is a big transformation in the fundamental platforms all of Wall Street and much of business," Werbach told Real Money. "Were really just seeing the start of it now."