ESPN commentary laid it on thick about how much of an injustice it was towards Reading.
First they suggested that VAR missed a high boot from Fred. Then early in the 2nd half they revisited it and somehow suggested that VAR got it wrong again as Fred was offside before Mata was fouled, so it shouldn't have been a penalty. Not sure how that's possible, as Mata is fouled as he plays the ball. Then later on they claimed that the referee didn't follow procedure and that the FIFA directive is that the referee should always go to the touchline and review it.
I can sort of see some merit in that line of argument. Haven't watched on ESPN but I did mention it too, although I ultimately I think the right decision was made here.
When replays are looked at to see if there was on offside or not, either by VAR or just pundits deciding if something was or wasn't, the action is frozen at the moment the ball is played because that's when the decision is taken from. The foul was a split second after he played the ball so you could say the offside already happened by then, taking it from the moment the ball was played.
Now the reason I don't think that's such a great argument in this case, is because 1) Mata looked like he was trying to dribble it to me, rather than pass to anyone and if not for the challenge could have retrieved his own touch 2) the flag only goes up these days once someone receives the ball (or a pass) even though the decision to see if you were offside or not happens at the point of the ball being played. As Mata was brought down before Fred touched it, foul.
There could be grey area in different circumstances though. If Mata is not brought down when he is, but randomly pushed over or brought down after the ball is the net you'd give the offside. If he's brought down with more of delay than he was today, say right at around the same time Fred touches it, then what?
Edit: Or for a more exxagerated example, not including a penalty, if someone hoists along, high ball forward and are caught immediately after releasing it you give the free kick even if the intended target of the pass is offside. But what if someone smacks a ball forward, runs ten yards and someone grabs his shirt right around the same time the intended receiver of the pass, who was in an offside position challenges for it? Foul for the shirt pull or offside?