Heat a large skillet over medium heat and add the oil. Once shimmering, add diced onions and bell peppers. Cook, stirring occasionally, until they soften and become fragrant, about 5 minutes.
Add the minced garlic, smoked paprika, and cayenne pepper to the vegetables. Cook for 30 seconds until the garlic is fragrant and the spices release their aroma.
Pour in the crushed tomatoes along with bay leaves. Stir to combine, then reduce the heat to low and let the sauce simmer gently for 15 minutes, stirring occasionally. The sauce should thicken slightly and smell smoky and tangy.
While the sauce simmers, prepare the shrimp by peeling and deveining them thoroughly. Pat them dry with paper towels to ensure a good sear.
Increase the heat to medium-high and add a tablespoon of oil to a separate pan. Once hot, add the shrimp in a single layer. Sear for 2-3 minutes per side until they turn bright pink and develop a slight caramelization.
Remove the seared shrimp from the pan and add them to the simmering sauce. Gently stir to coat and cook together for another 2 minutes, allowing the flavors to meld.
Remove the bay leaves, then squeeze fresh lemon juice over the dish. Taste and adjust seasoning with salt and hot sauce as needed.
Let the dish rest for 5 minutes off heat to allow the flavors to deepen. Then, serve hot, garnished with chopped herbs if desired, alongside rice or crusty bread.
