Whisk the ingredients together in a small saucepan. Heat to medium heat, then simmer until thickened and reduced to 1 cup (or ¾ cup for thicker sauce).
FOR THICKER EEL SAUCE (optional)
As the eel sauce is simmering and reducing, swirl together the cornstarch with water to form a slurry. Stir into the eel sauce and simmer, stirring, until the sauce thickens, 2-3 minutes. If it becomes too thick, add a bit of soy sauce or water to loosen it up.
Notes
You can use half the sugar, but the sugar is what helps to thicken the sauce as it reduces. If you prefer less sugar, use half the sugar, but then add the cornstarch per the optional part of the recipe.