Heat olive oil in heavy 3- or 4-quart sauce pan. Stir in shallots and garlic and saute over medium heat 2 to 3 minutes, or until softened but not quite browned.
Stir in chicken broth, water, tomatoes and dry basil. If using fresh basil, add it later. Add a few pinches of pepper.
Heat heavy cream about 45 secondsin microwave and stir into tomato mixture. Bring just to a boil; immediately reduce heat and simmer 5 minutes. If using fresh basil, add it now. Do not allow soup to boil once it is added. Serve immediately.