it will close on its own, with the only concern being whether the time rquired and the resulting rot of the underlying wood is significant. I would think a 1/8" hole woould close sufficiently fast to be of no concern.
If concerned, you could wrap the area with parafin film to keep out gross moisture, or graft a piece of the same tree across the lesion, top and bottom, to speed healing.
Air layering would also be a solution, but perhaps a solution in search of a problem? I wouldn't bother.