Yeah. Let's ignore the record profits being made by oil companies. Let's just blame elected officials. I'm sure if the CPC was in power right now gas would still be $1.25/L right?...
Does the oil company set the prices or does the market?
But to farther answer your question, yes a canadian gov could use canadian oil and back out of the global market and sell canadian fuel to canadians at any price it wants.
Or a gov could fight against oil and put huge taxes on it.
Or a gov could lower the taxed they charge on fuel to help its people.
What gov like higher taxes? And what one like lower taxes?