Dissolve sugar in 1/2 cup warm water in a large mixing bowl which has first been rinsed in hot water. Sprinkle yeast on top and let stand for 10 minutes. Stir to dissolve.
Combine yeast and water with oil, more water, sugar, salt, eggs, and half of flour. Beat well. Stir in remaining flour. Dough should be sticky. Cover dough and let rest for 10 minutes.
Turn out onto a floured board and kneed for 10 minutes, adding flour as needed. Round up in a greased bowl. Cover and let rise in a warm place until double in bulk, about 1 1/2 to 2 hours.
Punch down, cover, and let rise again until double, about 45 minutes.
Divide dough into 3 equal parts. Shape into strands. Place on a lightly greased baking sheet and braid loosely. Fasten ends securely. Cover with a damp cloth and let rise until double.
Beat egg yolk with water, then brush dough with egg yolk mixture and sprinkle with seeds. Bake at 400F for 30 minutes, until golden brown.