More details on the subject:
I suppose it is a nested KVM issue because it raised after I enabled the nested KVM feature. Without it, anyway, the second level VMs are unusable in terms of performance.
I am using CentOS 7 with:
kernel: 3.10.0-327.22.2.el7.x86_64
qemu-kvm:1.5.3-105.el7_2.4
libvirt:1.2.17-13.el7_2.5
on both the baremetal and the compute VM.
The only workaround now is to shutdown the compute VM and start it back from baremetal with virsh start.
A simple restart of the compute node doesn't help. It looks like the qemu-kvm process corresponding to the compute VM is the problem.
Laurentiu