1.   Put the olive oil and the onion in a saucepan, and cook over medium heat for about 3 minutes, until the onion is soft but not browned. Add the tomatoes, water, salt, and sugar and simmer for 15-20 minutes, stirring.
Preheat the oven to 350 F. In a mixing bowl, combine the cream cheese and goat cheese until smooth. You will need eight 6-inch shallow baking dishes.

2.  When you are ready to serve, place a scoop of cheese in the center of each baking dish. Bake in the oven for about 5 minutes, until the cheese is just lightly browned but not melted.
Remove from the oven and carefully pour some of the tomato sauce around the cheese. Sprinkle with salt and pepper to taste and garnish the top with the chopped basil.

3.   Serve at once with the French bread on the side.