Blockchain platform goes live for North Sea crude oil trading
LONDON (Reuters) – Oil majors and trading firms can start finalizing crude oil deals on a live blockchain-based platform for the first time, in a move that could revolutionize the market.
FILE PHOTO: A BP logo is seen on a petrol station in London November 2, 2010. REUTERS/Suzanne Plunkett
Commodities trading firms have piloted similar schemes in recent years as blockchain technology has the potential to drastically cut costs in an environment of razor-thin profit margins.
London-based platform Vakt is the first of these to go live, with shareholder Gunvor Group saying it was rolled out on Wednesday, although no trades took place that day.
Blockchain, the platform behind cryptocurrency Bitcoin, is viewed by many as a solution to trade and settlement inefficiencies, as well as a way to improve transparency and reduce the risk of fraud.
Vakt was created in 2017 by a consortium that includes oil majors BP (BP.L) and Royal Dutch Shell (RDSa.AS), Norway’s Equinor, global energy trading firms Mercuria Energy Group and Koch Supply and Trading, as well as Gunvor.
These firms will initially be the only users of Vakt but access will be opened up in January next year.
Banks ABN Amro, ING and Societe Generale are other shareholders.
Vakt digitizes and centralizes what was previously a mountain of a paperwork shared between all the parties involved in each deal. It will be linked to another platform launched earlier this year, Geneva-based komgo, which will provide financing including digital letters of credit.
“Vakt is the logistical arm…Once a deal is executed through our book of records, it gets pushed through Vakt. The next leg is the financing and the link-up with komgo gives access to several banks,” said Eren Zekioglu, Chief Operations and IT Officer at Gunvor Group.
komgo, which is due to go live before the year end, is backed by a consortium including 10 global banks and most of the Vakt shareholders.
The financing platform will target the full spectrum of commodities trading, from oil to wheat.
Use of Vakt will at first be limited to contracts for the five North Sea crude grades that are used to set dated Brent, a benchmark used to price most of the world’s crude oil.
In early 2019, the platform plans to include U.S. crude pipelines and barges of refined products like gasoline in northern Europe.
“It’s an exciting time,” Andrew Smith, Shell’s head of trading, said.
“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.”
Reporting By Julia Payne; Editing by Kirsten Donovan
Twenty-Three Kenyan Entrepreneurs to represent the country in the upcoming Forty Under 40 Africa Awards 2023 : TechMoran
Latest Mobile App Development Trends To Dominate In 2023 : TechMoran
FORMER ARSENAL, REAL MADRID AND GERMANY MIDFIELDER OZIL RETIRES – GhettoRadio 89.5 FM
NSL: Shabana look to end first leg on a high
Ruto retains Ex-Solicitor General Ogeto to be Legal Advisor, Karisa Nzai Political Affairs Advisor » Capital News
HOUSES FLOODED IN WARUKU SLUMS AFTER HEAVY DOWNPOUR – GhettoRadio 89.5 FM
Firat: Kenya can qualify for 2030 World Cup
PEAKY BLINDERS’ CILLIAN MURPHY LANDS FIRST BAFTA NOMINATION – GhettoRadio 89.5 FM
Uber Announces Community Empowerment Initiative For Women Earners
Chelsea Wins First Leg Encounter With Lyon » Uzalendo News
The Standard – Breaking News, Kenya News, World News and Videos
Adola, Rotich set for Paris Marathon showdown
Coca-Cola joins other corporates during the Two day
Mwalala tells Ulinzi no time to celebrate after reaching quarters
In Kenya, men only marry women – Peresident Ruto – Kenya Satellite News Network
State must obey court orders
Garissa University stands tall to the chagrin of terrorists
CBC workload has made parents direct beneficiaries
Patricia Njirwa: Open letter to Odinga, Karua and Musyoka
William Ruto’s headache in bid to woo foreign investors amid protests
General News3 days ago
At Least Eight Dead In India Temple Collapse » Uzalendo News
Entertainment6 days ago
Azimio must train supporters on peaceful demos
General News3 days ago
Salva Kiir appoints defence minister, breaches peace deal – Nairobi Times
General News6 days ago
Waiyaki Way, Other Nairobi Roads Barricaded by Police During Raila Protests [FULL LIST]
Tech4 days ago
UAE’s fintech Qlub raises $25 million to grow its operations : TechMoran
Entertainment4 days ago
MC Fullstop in the ICU following collapsed lung
Tech6 days ago
Paying for a blue badge on Twitter, are you game?
Sports4 days ago
Uganda edge Tanzania to revive 2023 Afcon hopes