In large sauce pan, heat olive oil.
Add onion and carrot, and sauté 5-10 minutes until starting to soften.
Add garlic and cook 5 more minutes.
Add drained diced tomatoes, water, and tomato paste, and bring to a boil.
After begins to boil, simmer on medium-low heat for 45 minutes.
Add basil, salt, and pepper, and cook 5 more minutes.
Remove from heat and using handheld chopper or blender, puree to desired consistency.