As Red Bull leapfrogged Ferrari in the standings, Lewis Hamilton says it the Milton Keynes team that is looking the most likely challengers to Mercedes.
Although Ferrari began this season as best of the race joining Mercedes on the podiums, it is Red Bull who have emerged as the stronger challenger in recent weeks.
In the last four grands prix, Red Bull have managed five top three results whereas Ferrari have just one.
That form culminated in Red Bull’s first double podium of this season championship in Germany where Daniel Ricciardo was second to Max Verstappen’s P3.
As such Red Bull have moved up to second in the Constructors’ standings on 256 points, 14 ahead of Ferrari.
“Red Bull is definitely our closest competitor,” championship leader told F1i.
“Daniel is performing really well and so is Max, and it’s not just because of them it’s because they’ve got a great team.
“They’ve got a very, very strong team. I think Red Bull have definitely picked up with their engine performance but also they’ve got great downforce.
“I don’t know why they’ve closed up a little bit more [in Germany] than others but they’re definitely looking incredibly strong.
“Ferrari looked strong at one point during the weekend and then they seemed to fade off more so in the race.”
With Red Bull showing improved pace, Hamilton admits he is going to have an even tougher time fighting back when he takes his grid penalties.
The World Champion is facing a 15-place grid drop should he opt to take his sixth turbocharger and MGU-H at the same grand prix weekend.
He added: “I’m conscious that there will be one race that I’m further behind that I don’t know how much I’m going to be able to regain.
“I don’t know the damage limitation will be, I don’t know how far I’m going to be able to get up.
“Now the Red Bulls have picked their pace up it might be hard to get past them, so it might be hard even to get into the top five.”