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What is meant by "neutral" oils? Conversely, what would make an oil not neutral? When is it important that the oil be neutral (or not)?

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Context would make me more sure, but I expect this is referring to neutral flavor.

If you need oil in something for purposes other than flavor, and want to make sure that the other flavors in the dish aren't affected or obscured, then you'd want a neutral oil. For example, for frying and sauteeing, we rarely use strongly flavored oil. (There's the additional problem that many flavors are destroyed at high heat; many more aromatic oils have lower smoke points.)

Oils like sesame oil, chili oil, and walnut oil are decidedly not neutral. On the other end, oils like canola oil, grapeseed oil, and peanut oil are neutral. Somewhere between there are things like olive oil, which has some flavor but isn't overwhelmingly strong.

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A neutral oil simply refers to the flavor. Olive oil, for example, is not neutral, it brings a distinct range of flavors to a dish. Grapeseed oil is considered one of the most neutral oils. It is nearly flavorless and can be used for frying, making herb oils, and other situations where you may not want any noticeable flavor from the oil medium.

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