What happened

Shares of Chevron (CVX -0.49%) jumped 8.9% on Friday after the energy giant delivered record profits fueled by higher oil and gas prices. 

So what 

Conflict in Europe and Russia's moves to reduce gas shipments have resulted in widespread shortages and a sharp rise in energy prices. Chevron's average sales price per barrel of crude oil was $89 in the second quarter, up from $54 in the prior-year period. Additionally, its average sales price of natural gas rose to $6.22 per thousand cubic feet, up from $2.16.

These higher prices combined with production increases helped to drive Chevron's revenue higher by 83% year over year to $68.8 billion. Its adjusted earnings, in turn, soared 245% to $11.4 billion, or $5.82 per share. That was far above Wall Street's estimates. Analysts had expected Chevron to report adjusted per-share profits of $5.10. 

Now what 

Chevron is working to ramp up its production volumes to help the world meet its critical need for reliable energy sources. "We more than doubled investment compared to last year to grow both traditional and new energy business lines," CEO Mike Wirth said in a press release. These investments have allowed Chevron to boost production in its key Permian Basin operations by 15% over the past year.

Yet Chevron is currently so profitable that it's also able to pay down debt while increasing its capital returns to shareholders. The oil and gas titan now intends to repurchase up to $15 billion worth of its shares in addition to paying its hefty dividend, which currently yields 3.5%.