Begin by peeling the red onion and slicing it into thin rings. Aim for uniform thickness to ensure even pickling. Place the sliced onions in a clean glass jar.
In a small saucepan, combine the white vinegar, sugar, and a pinch of salt. Heat the mixture over medium heat, stirring until the sugar dissolves completely.
Once the sugar has dissolved, add the bay leaf, allspice berries, whole cloves, and the dried chile pepper to the saucepan. Allow the mixture to come to a gentle simmer for about 3-5 minutes to infuse the flavors.
Remove the saucepan from heat and carefully pour the hot brine over the sliced red onions in the jar. Ensure all the onions are submerged in the liquid.
Allow the jar to cool to room temperature. Once cooled, seal the jar with a lid and place it in the refrigerator.
Let the pickled onions sit in the refrigerator for at least 1 hour before using. For the best flavor, wait at least 24 hours.