Heat oil and butter in a large pot. Add onion, parsley, and garlic and cook unt il onion is transparent. Add sherry and cook an additional five minutes. Add to matoes and tomato sauce, bay leaves and seasonings. Stir frequently while cooki ng 15 to 20 minutes. Add water, cover, and simmer for a half hour.
Add all seafood except halibut to the sauce. Add more water if necessary. Cook for five minutes, add halibut, and cook an additional ten minutes. When clams h ave opened, cioppino is ready to serve.