Chevron Corp. said it reaped big benefits from surging natural gas and crude prices in the third quarter, bolstering free cash flow (FCF) and paying down debt while positioning the company to further increase production.

The San Ramon, CA-based integrated major produced $6.7 billion in free cash flow in the quarter, more than at any point in its history, as both upstream and downstream operations posted substantial leaps in income while holding costs in check. The company said that, compared to results prior to the pandemic, its operating costs are lower, even as upstream production is up, making Chevron more capital-efficient.

The company reduced debt by $5.6 billion during the third quarter to $37.3 billion. 

“Cost efficiency and capital are essential to navigate...