Melt about 1 teaspoon butter in a small sauté pan over medium heat. Add onions and sauté onions until limp and just slightly brown at the edges. Set aside to cool.
Combine softened cream cheese, lemon juice, water, sugar and salt in blender or food processor. Process until smooth and creamy. Blend in onion. Add chopped fresh basil and pulse until pieces are evenly distributed. (Add an extra tablespoon of water if mixture seems too thick to blend.)