Add the oil to a small pot along with the serrano peppers, shallot, garlic, peppercorns. Add the cinnamon stick and star anise pods, if using.
Heat the oil to medium-low and simmer for 20-30 minutes, or until the ingredients in the pot brown. It could take longer for the bits to brown and crisp depending on the size of your chopped peppers and oil temperature.
Remove from heat and allow to cool for 2-3 minutes. The flavors will infuse the oil even further. In a separate heat-proof bowl, mix together the chili flakes, paprika (or Gochugaru), soy sauce, sugar and msg.
Strain the oil into the chili flake mixture. Reserve the crispy serrano-shallot-garlic bits in the strainer and set them aside for now to cool, which will allow them to fully crisp up.
Pick out the cinnamon stick and star anise pods (if using), then swirl the crispy bits back into the oil.
Cover and refrigerate overnight to let the flavors develop even more. It will last in the fridge for months. Just pull it out to room temperature about 30 minutes. Stir before using.