Traffic oscillations on freeways are one of the most important causes of low vehicle energy efficiency, and they result in a large amount of vehicular emissions and high risk of incidents. Most existing studies of freeway eco-driving either focused on one-lane roads or relies on high market penetration rates of connected vehicles, which are not realistic for the early-stage development of connected vehicles. This paper develops an advanced vehicle control system with connected vehicles to mitigate freeway traffic oscillations. This system is able to work for smoothing traffic oscillations on multi-lane freeways with a small number of connected vehicles. It applies the connected vehicles to capture freeway traffic oscillations based on their trajectory information, and a variable speed limit control system is implemented on the connected vehicles to adjust over-passing volumes so as to mitigate downstream traffic oscillations. A mathematical model is proposed to analyze the effect of the system on mitigating traffic oscillations under freeways with multiple lanes. In addition, the system is implemented in both macroscopic and microscopic simulations to understand its benefits on smoothing traffic oscillations along freeway segments and increasing energy efficiency.