Step 1 Place the water in a small bowl and sprinkle the gelatin over the top. Stir to distribute, and set aside to soften 2 to 3 minutes.
Step 2 Wipe the insides of 8 (one-half-cup) ramekins with a light coating of neutral oil and set aside. Half-fill a large bowl with ice and add enough water to make an ice bath and set aside.
Step 3In a small saucepan, combine the cream, milk, sugar and split vanilla bean, and bring to a simmer over medium heat. Remove from heat, and whisk in the softened gelatin and the vanilla extract, if using. Scrape the vanilla seeds from the bean pod into the mixture, and discard the pod.
Step 4Set the saucepan in the ice bath (making sure the top of the saucepan is well above the surface of the water), and whisk until the mixture is lukewarm. Rub your fingers together: There should be no grit from undissolved sugar or gelatin.
Step 5Ladle the mixture into the oiled ramekins and chill at least 4 hours or overnight. If you're going to keep them longer than overnight, cover them with plastic wrap, pressing the wrap gently against the panna cotta to prevent a skin from forming. Be aware that preparing the panna cotta more than 24 hours in advance will result in a somewhat firmer set.
Step 6About 10 minutes before serving, run a thin-bladed knife around the inside of the ramekin. Dip the ramekin briefly in a bowl of hot tap water, and then carefully invert onto a serving plate. If the panna cotta doesn't unmold right away, tap the ramekin lightly on the countertop to loosen it. If it still doesn't unmold, return it to the hot water bath for another five seconds and repeat. Panna cotta can also be served without unmolding.