Add oil to a saucepan and heat to medium-high. Add in the onion and stirring now and then, saute until softened. Add the ground beef and cook for several minutes, breaking up the ground beef. Do not brown. Add the water and continue to break up the beef as the water simmers.
When the water is nearly gone, add in the chili powder, salt, pepper, celery salt and dry mustard and stir in. Cook, stirring for about a minute. Add the ketchup, Worcestershire, tomato sauce and if using, to taste, a dash or two of hot sauce and the sugar. Continue to cook 15 to 20 minutes until desired consistency is reached. Taste and adjust any seasonings.
Once cooked as it cools and later if refrigerated, the sauce becomes thicker. Add additional water to bring back to desired consistency.