Fill a large pot with water and bring to boil. Add octopus, onion, and bay leaves. Simmer gently until octopus is tender, approximately 35-40 minutes.
Remove octopus from water and allow to cool slightly. Cut tentacles into bite-sized pieces, approximately 3-4cm.
Heat olive oil in a large skillet over medium heat. Add garlic slices and fry until golden and fragrant, stirring occasionally.
Add fresh chili slices to the hot oil and fry briefly for 1-2 minutes to infuse flavor.
Sprinkle paprika powder into the oil, stirring constantly for 30 seconds to avoid burning. The paprika will bloom and release its smoky aroma.
Add the cooked octopus pieces to the infused oil. Toss gently and cook for 2-3 minutes, ensuring octopus is evenly coated with the paprika oil.
Season with sea salt and black pepper to taste. Transfer to a serving plate while still warm and sizzling.
Drizzle any remaining infused oil over the octopus. Serve immediately with lemon wedges and crusty bread on the side.
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