Can blockchain transform the entire oil industry?

The complex oil trading relationships create the need for a shared ledger and provide opportunities to differentiate their service. Blockchain technology is changing everything from global supply chains in the oil and gas industry to how companies trade stocks and even how medical data is stored. It is a technology that has the potential to transform industries at every level, and it is continually making headlines across industries. Everything that happens in the modern world is now accessible on the internet as a new trend. Learn the benefits of trading oil with Bitcoin. 

The oil and gas industry has already taken notice of blockchain technology’s impact on the industry, particularly within their supply chain organizations. The recent creation of the International Oil Blockchain Consortium (IORBC) represents the growing interest in this new technology. 

Thirty-five energy companies founded IORBC to advance collaborative research, development, and integration of blockchain technologies for oil and gas exploration and production companies across geographies. A recent report suggests that approximately 75 percent of oil companies are exploring or actively testing blockchain solutions. As a result, disruption in oil supply chains is inevitable, and blockchain technology will pave the way.

Oil companies are looking to implement blockchain technology.

The oil and gas industry is one of the top five industries to provide supply chain solutions, with an estimated $300 billion spent on supply chain technology total in 2018. Blockchain has different applications in the oil and gas industry, including tracking shipments/contracts, disclosing drilling results, and managing real-time inventory control and contract. 

Blockchain technology is changing the way oil and gas companies do business:

Blockchain projects focus on tracking and verifying supply chain assets, particularly within the oil and gas industry. Compliance requirements are increasingly important for companies as regulators continue to hike fines for non-compliance. 

Blockchain allows for heightened transparency with privacy concerns while allowing regulators to obtain verified records of assets. The industry is already seeing positive results, with approximately 18 percent of energy firms developing a proprietary blockchain platform. The growth in the use of technology can be attributed to regulatory changes and increasing demand for greater accountability. 

IORBC helps find the right blockchain solution for the oil and gas industry

People created the consortium to establish standards and best practices for blockchain technology implementation and provide tools for building successful platforms that users across numerous industries can scale. In addition, this group will offer assistance from research to implementation. 

Blockchain is already changing how transaction data is stored:

Blockchain is currently working with exploration, production, supply, and transportation sectors, which include over 100 companies covering multiple geographies in the oil industry. The IORBC offers a collaborative, open, and transparent approach to building industry-wide standards while providing the tools needed to scale projects. In addition, the consortium will work with global blockchain organizations to create a joint research agenda and develop a crowdsourced blockchain platform that people across the industry can use.

Blockchain technology is transforming the oil supply chain.

The future of blockchain technology looks bright in terms of transforming industries, including the oil and gas industry. By utilizing this new technology, companies will gain greater visibility into their complex supply chains and trading operations for real-time information exchange. Blockchain can provide significant improvements in existing business processes.

Blockchain can provide better transparency in a complex environment.

Oil and gas companies have highly-complex supply chains that span multiple countries. Blockchain technology will provide better visibility into these processes, including oil exploration, drilling, shipping, and more. In addition, blockchain will provide a single source of truth for all stakeholders, which will help reduce the risk associated with human error.

 Blockchains can be constructed by people with different levels of privacy (public or private) to ensure data is secure throughout the exchange process. It adds a layer of trust to a complicated system where trust is essential among many stakeholders. Blockchain technology can help companies manage contracts, shipments, and more.

One of the primary uses of blockchain technology is to provide a way to safely record, track and validate transactions while also providing privacy (security) regarding the exchange process. This transparent technology can help reduce risks in supply chains where fraudulent activities occur daily. This new technology can track contracts and shipments, improve communication and make it easier for stakeholders to understand costs. Existing oil companies are finding that blockchain is an easy way to manage their supply chain operations in multiple markets while preventing fraud.