Add whole peeled pearl onions to a large saute pan and over medium-low heat, add oil and butter.
When onions start to simmer, add the vinegar, sugar, salt and 2 tablespoons of water. Stir and cover with a lid.
After 10 minutes, check the liquid. If the pan is dry, add another 2 tablespoons of water.
After 10 more minutes, check your onions. They should be tender and the sugars should be nicely caramelized. If they are not tender, simmer another 5 minutes until they are ready. Remove and chill until ready to serve.
Serve with mini toothpick skewers.
Add fresh thyme for additional flavor.
*Do NOT use canned cocktail onions in place of raw pearl onions.