Place olive oil and butter in a large saucepan over low-medium heat. Add in 2 cloves of minced garlic and sauté for a couple of minutes until fragrant.
Add oregano, pepper, salt, and a pinch of red pepper flakes. Place the whole can of tomatoes and juice into a large bowl. Use a pastry blender to crush the tomatoes into a bit smaller pieces. Add crushed tomatoes to the saucepan. Separate the basil leaves from the stems. Add 3-4 stems of fresh basil, mix together and cook for 3-4 min.
Add sugar to the saucepan. Cut the onion in half leaving the root in tact. Peel the outer layer off of the onion and discard. Place the peeled 1/2 onions face down in the sauce and cook for 45 min on low.
Cut basil leaves into strips. Add the basil leaves after 45 min and cook for 5-15 min. They can turn bitter if you cook them for too long, so best to cook them for as little time as possible. Fresh basil will wilt and combine in the sauce easily using a wooden spoon to press them into the sauce.
Remove onions and basil stems from the sauce using a strainer and discard. Blend the pizza sauce with a blender until smooth.
Pizza sauce is ready to use.