what is chilli oil and is it chilli or chili ?

Chilli or chili or chile oil is a spicy oil infusion made by adding chili flakes or whole dried chilies to an oil such as vegetable or olive oil. It is often used as a condiment, especially in Asian cuisine, and it can also be used as the base for a sauce or sautéed dish. Many grocers carry this oil, especially in the Asian or specialty foods aisles. It can also easily be made at home.

All oils do better if they are refrigerated after opening. Refrigeration prevents oils from going rancid as quickly. Chili oil from the store is designed to be shelf stable for several months, but refrigeration will prolong its life. When making chili oil at home, it should always be refrigerated, as most home cooks lack stabilizers which will keep the chilies in the oil from molding. When used as a condiment, chili oil generally enhances the spiciness of a dish it is used on. When different people have varying heat tolerances, this oil can be an excellent way to avoid disputes, since it allows each diner to season to taste. Many Asian restaurants have small dishes of chili oil on the table, or can provide it when requested. When used as a base, this oil will greatly enhance the spiciness of a dish, since the temperatures of cooking will bring out the heat.

Many kinds of oil are used to make chili oil. Olive and vegetable are two common choices, but it can also be made with oils such as canola, sunflower seed, sesame, and avocado. Some oils have a low smoking point, and should be used in a cold infusion. Heating these oils should also be avoided, if possible.

To make chili oil at home, cooks can make a hot or cold infusion. In either case, the bottle that the oil will be held in should be boiled and allowed to dry completely, to make it as sterile as possible. In the instance of a cold infusion, whole or crushed dried chilies can be put into the bottle along with the oil. The bottle should be refrigerated for at least a month before opening, with a longer waiting period creating a richer flavor. Hot infusions are made by heating oil and chilies together and pouring the mixture into a bottle, which is usually refrigerated. In the case of a hot infusion, the oil can be strained, or the chilies can be left in so that the infusion will grow hotter as it sits.

But what is it really? There are three spellings for this hot pepper from several varieties of the genus Capsicum: “chili,” “chile,” and “chilli.”

Which is correct? It depends on where you live.

The usual spelling in American English is “chili,” but “chile” is an acceptable variant. The only spelling in British English is “chilli,” though the Brits use the term for both hot and sweet peppers. So theres really nothing wrong with how you spell it because we're in Asia. 

I decide it to call mine BagWings Garlic Chilli oil. Regardless of how you spell it, this famous side dish is a way for my parents to unite us (Their kids.) They would cook all our requested dish and then they'll match it with their home made garlic chilli. I see my mom and dad smile in silence as their children (we are all adults now) cant stop eating and talking about life in the middle of small round table. 

Simple joys of life.

Source: http://www.wisegeek.com/what-is-chile-oil.htm