(Repeats with no changes. John Kemp is a Reuters market analyst. The views expressed are his own)

* Chart 1: http://tmsnrt.rs/1TgyFCG

* Chart 2: http://tmsnrt.rs/1V5Y0Ee

* Chart 3: http://tmsnrt.rs/1V5Y3jb

* Chart 4: http://tmsnrt.rs/1V5Ypqg

By John Kemp

LONDON, May 16 (Reuters) - "The oil market has gone from nearing storage saturation to being in deficit much earlier than we expected," Goldman Sachs analysts said in a research note published on Sunday.

"The physical rebalancing of the oil market has finally started," according to the bank, which has been among the most bearish on the outlook for surpluses and prices.

Goldman raised its near-term forecasts for WTI by around $10 per barrel in both the second and third quarters of 2016 ("Fundamental volatility creates uncertain path for oil rebalancing", Goldman Sachs, May 15).

In many ways the bank is playing catch up, because WTI has already risen $20, almost 80 percent, from its low on Feb. 11.

Goldman is exceptionally well connected with the hedge fund community and its forecasts are famous for influencing oil prices, at least in the short term.

But Goldman and the majority of hedge funds parted company on the oil outlook at the start of the year ("Oil price ultra-bear Goldman Sachs turns mildly bullish", Reuters, May 16).

While the bank remained cautious about market rebalancing and warned about the possible correction in prices, hedge funds were amassing a record bullish position in futures and options in anticipation of a recovery.

Between the start of January and the end of April, hedge funds and other money managers almost tripled their net long position in WTI and Brent futures and options from 234 million barrels to a record 663 million barrels.

Long positions anticipating a rise in prices were increased by 133 million barrels while short position expecting a price fall were cut by 208 million barrels (http://tmsnrt.rs/1TgyFCG).

In the past couple of weeks, however, just as Goldman was turning more bullish, the hedge funds have become more cautious and been taking profits following the rally.

The combined net long position in WTI and Brent was cut by 43 million barrels in the week to May 3 and a further 45 million barrels in the week to May 10, an overall reduction of almost 13 percent.

Most of the adjustment has come from the long side of the market, as hedge funds have locked in some of their profits, with more modest amounts of fresh shorts emerging.

The balance of forces in the oil market between supply-demand fundamentals, hedge fund positions and oil prices has become rather complicated.