I have made around 20 of these in various forms, I have used branches with smaller branch stubs on and trimmed to about 20mm and smoothed them to leave a more rustic look, or cut the top at a slight angle, I have Also used a larger thickness branch and set 3 or 4 T-lites in. Once, at the point where I was going to start sanding I thought No!, leave it like that! - Just a slice of Oak with a hole in one end with some twigs and leaves still attached, - now that's rustic...
So you may not want the sandpapers Oil or wax, or you could take it even further and do some carving/sculpting
There are so many variations to experiment with... I would like to see what other people come up with.
WARNING! WARNING! - For those without common sense...
Sharp tools and power tools are dangerous, you may hurt yourself if you don't take care.
Some wood finishes are flammable, so don't use them to finish a candle holder.
Never leave a burning candle unnattended.
Making things is addictive so you might be making lots of these or similar for your friends and family.
I have more effective tools but not everyone has, so I've kept it basic so that most people can try this project.
Step 1: Tools and Materials:
Suitable branch wood.
Saw - the finer cut the better = less sanding.
Drill and bit. - Forstner better but a spade bit would do. (an auger would make a real mess).
Oil, wax or your prefered finish. - I go for natural wax or Danish or Tung oil.