In a large mixing bowl, combine the all-purpose flour, baking powder, and salt. Whisk thoroughly to distribute the baking powder evenly throughout the flour. This helps the bread puff and develop a tender texture as it fries.
Pour in about 1 cup of warm water and the 2 tablespoons of vegetable oil. Stir with a wooden spoon until a rough dough begins to form. Gradually add the remaining water as needed until the dough comes together. It should be soft and slightly tacky, not wet or overly sticky.
Transfer the dough to a lightly floured surface. Knead gently for about 2–3 minutes, just until it becomes smoother. Avoid adding too much extra flour, as a stiff dough can produce dense fry bread.
Return the dough to the bowl and cover it with a clean kitchen towel. Let it rest for 30 minutes at room temperature. This allows the flour to absorb the moisture and makes the dough easier to shape.
Divide the dough into 8 equal portions and roll each into a ball. Flatten each ball with your hands or a rolling pin into a round about 6–7 inches wide and approximately ¼ inch thick. Keep the rounds covered while shaping the remaining dough to prevent them from drying out. Make a small hole in the center of each round if desired to help it cook evenly.
Pour vegetable oil into a heavy-bottomed skillet or Dutch oven to a depth of about 1–2 inches. Heat over medium heat until the oil reaches approximately 350°F (175°C). If you do not have a thermometer, test with a small piece of dough; it should bubble steadily when added without browning immediately.
Carefully place one dough round into the hot oil. Fry for about 1–2 minutes on the first side, until puffed and golden underneath. Turn with tongs and fry the other side for another 1–2 minutes. Adjust the heat as needed to keep the oil temperature steady, and fry in batches without overcrowding the pan.
Transfer the cooked fry bread to a wire rack or a paper towel-lined plate to drain excess oil. Repeat with the remaining rounds, allowing the oil to return to temperature between batches. Serve warm with your preferred savory toppings or sweet additions.