1 cup packed dried red chiles, soaked in lukewarm water for 20 minutes
1 cup peanut oil
Drain the chiles and remove and discard the stems. Put the chiles in a food processor and process to a coarse paste.
Pour the oil into a nonreactive pan and set over medium heat. Add the chile paste and bring to a bubbling boil, then remove from the heat and let stand until cooled to room temperature.
You can store the oil with the chiles in it, but in Burma the oil often is served on its own. For clear oil, drain the oil through a sieve into a clean, dry glass jar and seal with the lid. Store away from heat and light. You can keep the chiles in another glass jar for a spicy condiment, or discard them.