This is generally a form of lens flare. It’s caused mainly by stray light reflecting between lens surfaces inside the optical system, creating flare artifacts such as rings, ghosts, and streaks.

The red color is usually influenced by two things:

1. the color of the original light source, and
2. the lens coatings and internal reflections of that particular lens.

A very bright light may appear white in the main image because it is overexposed, but the reflected flare is dimmer, so its underlying color can show more clearly rather than clipping to white. Different coatings can also tint the flare red, amber, green, etc.

Smoke or haze can make the effect look softer or more visible, but they are not usually the primary cause of the ring itself. The ring is mainly an optical flare artifact from the lens.