IMO, it was not a penalty for exactly the reason that his arm was in a natural position AND close to his body when the ball struck it. So it was an error to award it. However, a split second before it made contact his arm, that arm did momentarily come a long way from his body (then he drew it quickly back in again).
Probably natural movement- but I do think it is mitigation for the ref… given the crazy rules they are told to implement nowadays.
A significant error - but not the worst big decision this weekend, probably not in the bottom 3. That Rotherham one was a shocker.