Chilli oil is a great way to add spiciness to your food, and bring out its flavours. Its really easy to make and tastes delicious.

[edit] Steps

Get some chillies. Wherever you get them make sure they are fresh and clean.
Get some oil. You can use groundnut oil, which is a light coloured oil that does not have a strong flavor of its own. Different vegetable oils can vary in their heating characteristics, and sunflower oil works well also, whereas olive oil is not quite so good because it has its own strong flavour, and does not get to quite so high a heat.
Cut the chillies into pieces. You can cut them lengthways, remove some of the seeds, and the inner pith, and then cut them crossways into pieces about a centimetre long.
Heat the oil in a suitable pan. Try using a small cast iron frying pan. Get the oil fairly hot, then throw in the chillies, and cook them for about 10 minutes.
Allow the oil and chillies to cool, then pour into a jar with a lid, and enjoy!
The chilli oil keeps for several weeks, but if you get a taste for it you'll probably use it all up quickly!

[edit] Tips

Make sure you have a generous enough amount of oil, and cover the chillies well when cooking them.
Experiment with different kinds of chillies, large and small, red and green, or combinations.
Be sure to have some idea of how hot the chillies you are using are. Some chillies are very hot and some are hardly hot at all.
When the chillies are cooked, they go slightly transparent.
It can be advisable to sterilise the jar/bottle before you add the oil. The oil will keep longer this way.

Be sure that the chillies don't burn when you are cooking them. Stir them with a wooden spoon.
Be very careful when cutting the chillies that you avoid rubbing your eyes in case you have chilli juice on your fingers. This can be really painful and irritating.
Be sure to allow the oil to cool before pouring it into a container. Hot oil can be hotter than boiling water, and might crack a glass jar, or melt a plastic one.