Stir sugar into warm water, add yeast, and let stand 5–10 minutes until foamy.
Whisk flour, salt, garlic powder, and Italian seasoning in a large bowl. Add yeast mixture and oil; stir to a shaggy dough.
Knead 6–8 minutes by hand or 5–6 minutes with a dough hook, until smooth and elastic. Dough should remain slightly tacky.
Place in an oiled bowl, cover, and rise 1 hour until doubled.
Divide in two. Flatten, roll up tightly, seal the seam, and shape into 10-inch logs. Place seam-down on a lined sheet.
Brush with olive oil. Combine cheeses, Italian seasoning, and garlic powder; press onto the loaves. Cover and rise 30 minutes.
Bake at 375°F for 18–22 minutes, until golden and 190–195°F inside. Air fryer: shape 6–7 inch loaves, cook one at a time at 320°F for 12–15 minutes, tenting with foil if the cheese browns early.
Cool on a wire rack at least 10 minutes before slicing.