Place the dried chiles in a medium-sized sauce pot and add enough water to cover them.
Bring the water to a boil and then cover the pot and remove it from the heat. Let the chiles hydrate in the hot water for about 20 minutes.
Remove 1 cup of the water from the pot and pour it a blender.
Then remove the chiles from the pot. Use your hands or a paring knife to gently remove the stems and seeds. Then add the chiles to blender.
Add the stock, garlic, spices, sugar, salt and pepper.
Purée until the sauce is completely smooth. This should take about 1 minute.
Pour the sauce into a storage container and stir in the olive oil. (The sauce should keep for at least 3 weeks in an airtight container in the refrigerator.)