(Bloomberg) -- Chevron Corp. boosted its planned share buyback to as much as $5 billion per year, as the oil giant uses higher commodities prices to step up returns to investors rather than investing in production growth.

The repurchases are now seen at $3 billion to $5 billion a year, about 60% higher than previous guidance, the company said Wednesday in a statement. Capital spending next year will be $15 billion, the low end of a previous forecast and 25% below pre-pandemic levels. 

READ: Chevron Eyes Boost to Share Buybacks on Energy Rally, CFO Says

The California-based oil giant generated the most free cash flow in its 142-year history during a third quarter in which oil and gas prices surged. But the company is wary of plowing that cash back into new production at a time when crude prices have sharply pulled back and the emergence of the omicron variant raises concerns about global oil-demand recovery. 

The budget reflects “Chevron’s enduring commitment to capital discipline,” Chief Executive Officer Mike Wirth said in the statement. It’s “at a level consistent with plans to sustain and grow the company as the global economy continues to recover.” 

Despite the tight purse strings, Chevron will spend $3 billion this year in the Permian, the world’s largest shale basin in West Texas and New Mexico. That’s a 50% increase from last year’s budget and a sign of the basin’s growing importance within Chevron’s overall portfolio. About $2 billion goes to the giant Tengiz project in Kazakhstan.

Some $800 million, or 5% of the total budget, will be spent on low carbon investments. Chevron stock climbed 0.3% to $112.45 a share at 5:28 p.m. in after-hours trading in New York. 

(Updates with CEO comment in fourth paragraph, adds additional details throughout.)

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