In a large skillet or stock pan add olive oil and heat until just before the oil starts to smoke. Add diced onion and green pepper to the pan and cook until tender. Remove from heat.
In a powerful blender such as a vitamix add the rest of the ingredients and blend until the cashews are blended into the liquid and you can no longer see pieces of them in the mixture.
Return your pan back on heat and add the cashew mixture. Stirring constantly while the mixture heats until it thickens into what appears to be a thick nacho cheese sauce. Serve in a bowl for dipping or on top of tortilla chips as vegan nachos.