P.M.
Time out with a verbal explanation is often less effective than giving positive messages and demonstrations about what you do expect from him. My daughter and my grandson both connect(ed) well to role-playing with toys or stuffed animals, and we've worked through many behavioral puzzles that way. The process also gives littles the language with which to tell what they want or need, and the acting out declines as they gain this power.
It might be helpful to know that sensory integration issues are pretty common, and it sounds as though your son might conceivably be uncomfortable and overstimulated when he feels "crowded" by other people. He may exhibit other traits, as well. You could use this checklist to investigate this possibility further, and the website gives lots of strategies and resources for helping kids cope better: http://www.sensory-processing-disorder.com/sensory-proces...
Good luck. Your son is at such an impulsive age, and he really doesn't have much control over that yet. As he becomes more verbal, he'll be able to ask for what he needs in a more civilized manner.