Piastri is one of the most highly credentialled youngsters of his generation, winning the 2021 Formula 2 Championship in his debut season.
It followed a similar feat in Formula 3 which in turn followed success in Formula Renault in 2019.
However, according to Horner, the Melburnian could well have been part of the Red Bull programme.
“He drove for the Arden team [owned by Horner] in Formula 4 and Formula Renault, and was obviously a significant talent,” Horner said on the latest Beyond the Grid podcast.
“There was an opportunity for Red Bull to look at him at the time, and we didn't take up that option – which is something I regret.
“But what he went on to achieve in Formula 2 and Formula 3 is phenomenal.
“If he had been a driver here, there is no way he wouldn't have been under lock and key for a period of time – I wasn't party [to negotiations], so it's difficult to judge what was promised or reneged on or so on.”
Elsewhere, Haas is expected to either remain with Mick Schumacher or opt for a Ferrari-aligned driver such as Antonio Giovinazzi.
Nyck de Vries has also underscored his credentials and has now also been linked with Alpine, along with Williams in place of Nicholas Latifi.
However, Horner believes Ricciardo is still capable of doing the job and would be on, or close to, the top of his list if he were in charge at Alpine.
“He's a great, driver, but he's obviously lost his way a bit. It would be great to see him remain in the sport,” Horner said of his former driver.
“I think I probably would [sign him] to be honest.
“They obviously know him from a couple of seasons ago, and he was very together during his last season there scoring podiums.
“I think he's the type of guy that you could rebuild him,” he added.
“It's obviously been a not a great experience for him [at McLaren], for whatever reason.
“You've just got to think back to some of the drives that he did for us, some of the wins that he had, the podiums, some of the stunning overtakes that he was capable of.
“That's still in there, I'm sure and he just needs a bit of a reset.
“Like in all sports, confidence is a big element, and for whatever reason, he hasn't got the feeling from the car across two sets of regulations.
“So that's probably eating away at his confidence, but there's still a very, very capable driver in there, and you don't just forget how to how to deliver.
So I hope for him he, he gets another opportunity and gets himself back on the grid for next year.”