Heat olive oil in a large skillet or cast-iron pan over medium heat. Add the chopped onion and cook until it softens and becomes translucent, about 5-7 minutes.

Add the diced red and green bell peppers along with the minced garlic. Continue to cook for another 5-7 minutes, stirring occasionally, until the peppers are tender.

Stir in the ground cumin, smoked paprika, and cayenne pepper (if using). Cook for just 1 minute more until the spices are fragrant.

Pour in the crushed tomatoes and the water or vegetable broth. Stir everything together. Bring the sauce to a gentle simmer, then reduce the heat to low and let it cook for 15 minutes, allowing the flavors to deepen and meld.

Using the back of a spoon, make four small indentations or wells in the tomato sauce. Carefully crack one egg into each indentation.

Cover the skillet with a lid and cook for 5-8 minutes. The cooking time will vary depending on your preferred egg yolk consistency. Cook until the egg whites are just set and the yolks are still wonderfully runny, or to your desired doneness.

Season the Shakshuka generously with salt and freshly ground black pepper to taste. Garnish with fresh chopped parsley before serving immediately.