This sounds stupid, as the drivers are amongst, if not the best in the world. But this illustrates the point even further. If this were two sim racing novices, then the outcome would almost be guaranteed to be completely different. It would end with both drivers crashing and ending up in a wall to the right-hand side of the virtual race track.
Just because you are the faster driver, or the car approaching with the most speed, doesn't mean you can make the pass or even have any right to make the pass. As a rookie sim racing driver you would think back to the old Senna mantra, "If you no longer go for a gap which exists you are no longer a racing driver" and so if you were in Vettel's position you would go for the overtake on the inside, understeer off your line, make contact with the other car and unless you were extremely lucky, both drivers' race would be over.
I'm not saying in any way that I know more than Senna did, that would be a ridiculous statement to make. However, although this looked like a gap, and it was a gap, it was in no way an overtaking opportunity, otherwise Vettel, one of the best drivers in the world would not have backed out of the overtake. Due to it being a practice session, Vettel expected the other slower car to back out and let him pass, however, when the realization that this wasn't going to happen, Vettel himself had to make this decision for both drivers. Racing, race craft and overtaking are all about situational awareness, not just raw speed. This is something that as a newer sim racing driver you will need to think and learn about.
As you learn more, which as a race driver, whether virtual or real world, you are always doing, you will find yourself in situations where you are approaching another car and although you have either more speed or a great run at them, it's still not possible to pass. The better your awareness and race craft, the earlier you realize this. This allows you to either fake to put the driver in front off, so they either miss a breaking point, make an error on entry to the next corner, which allows you to get a better exit, or they make a mistake due to the pressure you've put on them - even though in reality, you were never going to make a move. It is amazing how many errors you can cause a driver in front of you to make just by putting your car in what they think is a threatening position.
A good example of race craft and thinking about making pass can be seen from the clip below. My teammate (white MP4-12c) is driving in a multi-class race and is in a class battle with a car infront and behind him. He uses a Corvette from a different class to not only overtake the car he is battling with infront, but also uses fantastic race craft to position his car to defend against the car behind, and then to use the car he was battling with ahead of himself to slow the approaching car from behind. To me, this is the perfect pass in traffic, on all levels. Split second decisions timed perfectly, but planned probably from about the time the clip starts and executed to perfection.
When driving in a race, it's not just about who can brake the hardest and latest and who can get on the gas pedal quickest - although these facets are always helpful - it's about reacting to what is happening around you and taking advantage of the situations that present themselves. If you come across a virtual driver that is erratic and dangerous whilst defending against a car behind you, it can quite often pay dividends to let the car behind you pass and let them deal with the erratic driver in front of you. Nine times out of ten, they will both end up in a crash allowing you to proceed unhindered.
Always pick your battles, as it takes two drivers with awarness to be able to battle and race hard, otherwise it will usually end in disaster.