At the end of the last season, the earthquake machine leveled The Glades and killed Tommy Merlyn. So at the beginning of this one, Oliver has left Starling City and holed up on that island where he spent five years. Well, at least he knows where all the best restaurants are. And by "restaurants" I mean "edible roots and berries." He doesn't spend much time there, because Felicity and Diggle parachute in to tell him he needs to come back to Starling City. He's resistant until they tell him that Queen Consolidated is in danger of a hostile takeover by an evil company run by Summer Glau. And Moira Queen is still in jail, because she confessed on live television to being involved in the whole earthquake machine plot that destroyed The Glades and killed thousands of people.
Once he's back in Starling City, Oliver hits Club Verdant, which is somehow being run by his underage sister Thea. And then it turns out that Felicity and Diggle had a secret motive in bringing Oliver back to town: there's a gang of costumed bad guys! They're called "The Hoods" and they act just like Oliver: they tell plutocrats they've failed the city, and they kill a bunch of people. Oliver refuses to fight them, even though they kill the mayor on live television. And even when they attack a meeting between him and Summer Glau, he stays out of it. It isn't until they kidnap Thea that he decides it's time to dish out some vigilante justice again.
However, Oliver has decided that Tommy was right when he called Oliver a murderer. So he's determined to do his vigilante work without killing anyone, which is a huge improvement in the show. He hunts down the bad guys really quickly once he gets involved again, because Felicity has spruced up the Arrowlair. It's still underneath the club, so she must have been doing a lot of work without Laurel noticing. Anyway, Felicity gives Oliver a new silly-looking bow and he goes out to a church to take out the four guys who are giving his vigilante gimmick a bad name. He goes out of his way not to kill them, which is admirable. Then he handcuffs them to a fence so that they can be arrested by Quentin Lance, who has been busted down to beat cop.
At the end of the episode, Oliver says he's going to keep not killing people. And he doesn't like the name "The Hood," which is absolutely fair. The show strongly implies he's going to use the name "Arrow," but until someone actually calls him that, I'm not holding my breath.
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Previously, as I remember, Oliver made out with Laurel where Tommy could see them, but Tommy died pretty soon after that in the giant earthquake caused by his father Malcolm. Moira confessed on television to being involved and Thea was making out with Roy, a kid from the wrong side of the tracks. That about covers it, I think.
We start with Oliver running shirtless (of course) through a jungle. He sees a plane above. This is how the last season started, but Oliver was all shaggy and bearded. This time, he's clean-shaven. A shot from inside the plane reveals that the plane has Felicity and Diggle in it, and it's about to crash because it's flying through dense clouds. It's aimed at Flashback Island! But...it's not a flashback at all! I don't know how to handle this turn of events. Diggle loads up a parachute and makes Felicity take the other one. They jump! I guess the pilot is on his own. They land safely on the beach, which looks different from the one in the first season. Maybe it's done some growing up in the last year. Felicity throws up. They walk past the Deathstroke mask to make sure we all understand that this isn't some random jungle-covered island.
After some walking, Diggle claims that he hears something. But it turns out to be nothing, so everything's fine. And then Felicity steps on a land mine. It's the kind where it goes off if you step off it, so she gets to stand there looking nervous. Diggle looks like he's going to save her with a pocket knife, but I don't think he really has a plan. Luckily, Oliver is lurking on a branch in a high tree. He swings down and yanks Felicity off the land mine, which only kills people within two feet of it. So she's safe. She tells him he's really sweaty, which I don't think counts as sexy banter. Diggle says he's a hard man to find. Oliver says, "You shouldn't have come here."
Oliver leads them to a jungled-up lair that turns out to be the remnants of the plane he was living in the first time he was on the island. Felicity is annoyed by his lack of hospitality and demands some water or coconut or something. He gives her water and says that he can't come back to Starling City. He's still sad about the giant earthquake that destroyed The Glades: "The Hood couldn't stop it. So don't ask me to put it on again. Ever." Diggle says they're here about his Oliver Queen identity, not the vigilante. Moira Queen is going to trial and his sister Thea is "out on her own." So Queen Consolidated is ripe for a takeover by something called Stellmoor International, who are legendary for gutting the companies they acquire. They'll probably lay off 30,000 employees, including Felicity. Diggle says nobody blames Oliver for leaving, but it's time to come home.