Vettel's confidence appeared to have taken a big hit following his much-publicized accident with team-mate Mark Webber in Turkey.
However, he returned to winning ways in Valencia and claimed not only the race victory but also the pole position - much to Horner's delighted.
"This is a very important victory for Sebastian and the team," Horner is quoted in France's L'Équipe. "We did not expect to be as efficient on this track, which was more favorable to McLaren and Mercedes.
"To have placed both drivers on the front row and then seen Sebastian dominate in the race is very satisfactory. Seb is back in business and led in an incredible way; I think it'll give him a confidence boost - he's had some bad races in which he was unlucky but he's right back on track now."
Vettel's European GP victory means he is now just 12 points behind pacesetter Lewis Hamilton in the Drivers' Championship.
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