Preheat oven to 350 degrees F (175 degrees C). Grease cookie sheets.
In a large bowl, cream together 1/2 cup butter and white sugar until light and fluffy. Beat in the eggs one at a time, then stir in 1 teaspoon vanilla and 1 teaspoon almond extract, 1/4 cup milk and oil. Combine the flour and baking powder, stir into the wet mixture. Roll dough into 1 inch balls. On a lightly floured surface, roll the balls out into ropes about 5 inches long. Tie into loose knots and place cookies 1 inch apart onto the prepared cookie sheets.
Bake for 5 minutes on the bottom shelf and 5 minutes on the top shelf of the preheated oven, until the bottoms of the cookies are golden brown. When cookies are cool, dip them into the icing.
To make the icing, cream together the confectioners' sugar, 1/2 cup butter, and 1 teaspoon vanilla and 1 teaspoon almond extracts. Beat in 3 tablespoons milk, one tablespoon at a time, then stir in the food coloring if desired.