This is almost definitely an abscess exit hole. They usually migrate and "blow" out the coronet band, and this has probably widened since growing down the hoof. It probably happened at least a couple months ago.
I would advice against putting oil all over the hoof or "sealing" the hole. Do your best to keep it clean, soak it with water and some apple cider vinegar or a natural antibiotic product called colloidal silver. Another good thing is tea tree oil, which you can drip into the opening. It's anti-bacterial.
The only thing you can do really is to let this grow out. Make sure you keep on top of trimming, and that your farrier keeps flares away from the quarters, or this could break off.