Filmed by Rob James. Edited by Vanessa Kortekaas. Still image by Getty.
Collection of data is critical, so you need the technology to collect all the data. But the real crux is what you actually do with the data. So the analytics part is critical.
And at the end of the day, what you do in trading is forecasting, so predictive analytics. We've always been in the predictive analytics. We used human brain power in the past. But clearly, more and more, you're using technology to help you to make better decisions, to do more predictive analytics, and at the end of the day, make better trading decisions.
On the upstream front, complete changes in the way you drill for oil. When we drill today in Argentina, for instance, we send the core sample to Houston for analysis, and we get a lot more information that was ever available before. We know where to drill and how to drill more efficiently.
The other part is what is happening in the world of artificial intelligence. We've got a lot more internal data through these systems. We have a lot more external data through these systems. We've got a very large increase in computer processing capabilities, and obviously, the development of algorithms to identify different patterns.
We are looking at that. We have a certain team within house which is then looking at certain specific ideas that we have in this area. And I can see this being quite an important part of the trading mix.
We ran a test last year where we had a physical oil cargo going from Africa to China. And we've run the regular system with the paperwork, the bill of lading, and so on and so forth, and we did a parallel blockchain. And the regular documents needed 40 days to get to destination. Well, actually, the blockchain contract managed to essentially conclude the same transaction from beginning to the end in four days. That will have a major impact on funding requirement for a trading company and undoubtedly lower the costs for the industry and make it more efficient.
VAKT is being set up to create a blockchain-based digital platform that will really modernise the post-trade completion of the commodities energy trading industry. We're going to start in a few select markets with the goal of bringing something to operation by the end of this year. From there, it can be scaled globally in 2019 and beyond.