In a large skillet or Dutch oven, saute shallots and garlic in olive oil over medium heat until shallots have softened and become translucent.
Add dried basil and oregano and saute one minute longer.
Add red wine to the pan, scraping the browned bits from the bottom of the pan. Bring the wine to a simmer until reduced in half - about 3-4 minutes.
Add tomatoes and tomato paste. Bring to a boil over medium-high heat. Reduce heat to low, cover with a lid, and simmer for about 30 minutes.
Taste the sauce and season with salt and pepper as needed. Add 1-2 teaspoons of sugar and simmer a couple minutes longer to take some of the acidity out of the tomatoes if desired.