STEP 1: In a saucepan, heat 3 tablespoons olive oil over medium heat. Add the 1 finely chopped onion and saute until soft and translucent. Add the 2 cloves garlic (chopped finely) and cook until soft. Take care not to burn the garlic!
STEP 2: Add 1/2 cup water or white wine, 1 teaspoon sugar, and 1 large can peeled and diced tomatoes. Then mix in the pinch of chili flakes (optional) and cook for a few seconds. Bring to a boil; lower heat and allow to simmer for about 20 to 30 minutes, stirring occasionally, or until sauce reduces and thickens slightly.
STEP 3: Season with salt and pepper. Add 1 tablespoon chopped fresh basil and mix well. (If using dried basil, use just 1 teaspoon and add along with the chili flakes in Step 2. Adding it early on will allow the flavor and aroma of the dried herbs to be released.)