SmartOil: Blockchain and smart contract‐based oil supply chain management

Abstract

The traditional oil supply chain suffers from various shortcomings regarding crude oil extraction, processing, distribution, environmental pollution and traceability. It offers only forward flow of products with limitations in quality inspection, fraudulent information and monopolistic behavior of supply chain entities. Inclusion of counterfeiting products and opaqueness of the system urge renovation in this sector. Technological advancement can now reshape the infrastructure of the supply chain for the future. Here, a conceptual framework utilizing blockchain and smart contract to monitor the overall oil supply chain is suggested. Blockchain is a used to monitor and support the security building of a decentralized type supply chain. The Internet of Things (IoT) sensors open a broader window to track the process and attributes in real time. A methodology to support reverse traceability for each participant of the supply chain is constructed. Implementation of smart contracts is also shown with detailed analysis. The challenges of implementing such a system are further described and our framework's adaptability in the real world is validated. The paper concludes with future research scope to mitigate the restrictions of data management and maintenance with advanced working prototypes and agile systems achieving greater traceability and transparency. INTRODUCTIONSupply chain management (SCM) in the oil industry holds great importance for its expansion and global market. The value of oil has a significant impact on the world economy. In general, SCM can be coined as the flow of ingredients from production to consumer. It includes several phases from supplying raw materials to end customer including manufacturer, distributor, retailer. For the oil supply chain, these entities are an industry or a company. Moreover, it is a global process as the crude oil is extracted from one place, processed and refined at another, and distributed worldwide. The traditional oil supply chain serves general purposes but cannot comply fully. There are certain limitations in tracking, monitoring, and giving the end customer power to reverse track. It generally goes with the forward flows, that is, the raw materials' flow to final products [1,2]. However, it is equally important to support the reverse flow of product information for any customer. Blockchain and smart contracts, along with Internet of Things (IoT) devices, can change the traditional supply chain for This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

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