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It refers to the VM itself.
However it is directly influenced by the host node performance.
Say, if your node has very bad io, any operation that needs storage access will make load jump due to iowait.
Also, if the CPU is busy with other things than wait, it is the same, tho, maybe not that terrible.
If this is happening all the time, you should consider another host, it may happen once in a while for a few minutes or even more for everyone, but constant load like this is not acceptable.
OTOH, vServer is showing load for the whole node.