Season the cod on both sides with salt, pepper, and Italian seasoning.
Heat olive oil in a wide skillet over medium heat. Add shallots and cook until softened, about 2 minutes. Stir in garlic and cook until fragrant, about 1 minute.
Add tomatoes, water or broth, salt, pepper, red pepper flakes, and Italian seasoning. Bring to a simmer, cover, and cook over medium-low heat for 5 minutes.
Crush the tomatoes with a spoon to form a coarse sauce. Taste and adjust seasoning, then stir in olives.
Nestle the cod into the sauce in a single layer and spoon sauce over the top. Cover and simmer gently until the fish is opaque and flakes easily, 8 to 10 minutes.
Drizzle with olive oil and scatter with basil and parsley. Serve immediately.