Shadow Oil

Shadow Oil gives the user a 15% chance to cast Shadowbolt III at the attacker on each hit.

Source
This item is made by Alchemists with a skill level of 165.

The recipe is sold in limited quantity by:
 * Bliztik in Duskwood
 * Montarr in Thousand Needles

As an ingredient
Shadow Oil is used in the following recipes:

Alchemy

 * Greater Shadow Protection Potion

Blacksmithing

 * Shadow Crescent Axe

Jewelcrafting

 * Wicked Moonstone Ring

Leatherworking

 * Dusky Leather Armor
 * Guardian Armor

Tailoring

 * Shadow Hood