Shortest answer: Maybe 😐. Tuning a SAN's performance is why we're all still employed 😉.
Definitely confirm iSCSI configuration, as noted by TMACMD. That is critical to your success. As to latency, it depends on a number of factors, including speed of your iSCSI interface, amount of data being transferred, load on the network during transfers, type of disks, number of hops, etc. Your description of the situation, though, seems to indicate that the storage vMotion is mainly responsible for the increase. Where are you measuring the steady-state latency, and are you just looking at the cluster's reported latency, or are you doing an end-to-end measured value? Are the customers seeing the latency, or are they getting normal performance & the latency is due to VMware prioritizing serving data to them over transferring data? I'll confess the last point is a guess - I am not a VMware engineer, so I'm using SAN & array-based knowledge to help you troubleshoot.
