  The cubic perovskite SrVO$_3$ is generally considered to be a prototype
strongly correlated metal with a characteristic three-peak structure of the
$d$-electron spectral function, featuring a renormalized quasiparticle band in
between pronounced Hubbard sidebands. Here we show that this interpretation,
which has been supported by numerous "ab-initio" simulations, has to be
reconsidered. Using a fully self-consistent $GW$+extended dynamical mean-field
theory calculation we find that the screening from nonlocal Coulomb
interactions substantially reduces the effective local Coulomb repulsion, and
at the same time leads to strong plasmonic effects. The resulting effective
local interactions are too weak to produce pronounced Hubbard bands in the
local spectral function, while prominent plasmon satellites appear at energies
which agree with those of the experimentally observed sidebands. Our results
demonstrate the important role of nonlocal interactions and dynamical screening
in determining the effective interaction strength of correlated compounds.
