In a large skillet with a lid, sauté onions, zucchini, and squash in the olive oil until soft. Stir in barley and heat for another minute or two. Stir frequently to lightly toast and prevent burning.
Add in 1 cup of the vegetable broth and bring to a slow simmer, cover, and allow to cook for about 3 minutes or until liquid is mostly absorbed.
Add the remaining vegetable broth and continue allowing the barley to cook approximately 25 minutes. Add 1/2 cup of water in intervals as needed to finish cooking the barley.
When barley has finished cooking , add 1/2 cup of water and the basil. Stir well until heated through.
Add in the nutritional yeast and butter. Season with salt and pepper.