While Toto Wolff and Red Bull now predict a three-way battle for this year's Formula 1 title, Ferrari has poured water on Mercedes' gains.

A raft of upgrades over the last two races has helped the eight-time defending Constructors' champions finally solve the porpoising problems which have limited their performance so far this season.

In Spain, George Russell managed his best qualifying result in fourth and then battled with both Max Verstappen and Sergio Perez on race day before having to settle for third.

Perhaps more impressive was Lewis Hamilton's recovery from a puncture on Lap 1 to what would have been fourth before late cooling issues dropped the Briton back to fifth.

“I’ve seen a race car today that reminded me of the race cars of previous seasons," Mercedes boss Wolff declared post-race in Barcelona.

Also Read:

• Wolff can 'only smile' at claims Russell is the new lead man at Mercedes
• Russell puts timeline on wins as Mercedes W13 'finally drives like an F1 car'
• Hamilton: 'No doubt' Mercedes will fight for wins in 2022 after Spain recovery

"When you are 30+ seconds behind the whole field and you come all the way to the front and near the podium, that is very encouraging and shows we have made another step.

“Can we fight for the World Championship? We bet we can. We just need to have a car that is able to finish first and second but I think we have reasons to believe we can get there.”

Despite their lack of pace, Russell's consistency means he is just 36 points off the lead in the Drivers' and Mercedes are 75 points behind Red Bull in the Constructors' Championship.

“If you look at the odds, they are against us,” Wolff conceded.

“But motor racing is a different ball game. We’ve seen [on Sunday] that Ferrari didn’t score a lot of points even though they should. We are absolutely pushing flat out in order to bring us back into the game.”

Red Bull boss Christian Horner also believes Mercedes are now a threat moving forward, citing his own team's recovery from a double DNF in Bahrain.

“I’ve said all year it’s only a matter of time before they get their problems under control and they now seem able to do so,” he told Sky Sports. “So they will be another factor in the World Championship fight.

"I think it also shows how quickly things can swing.

"After Australia, we came home 40 points behind, and we lead by six going into Monaco a couple of races later. So it just shows in Formula 1, how quickly things can swing and change.

"That's why I wouldn't write off Mercedes with the amount of points still available. We know Ferrari has a very quick car. So you know, things can turn around very quickly."

However, at Ferrari, team boss Mattia Binotto used the numbers from Spain to argue Mercedes still has a long way to go to consider themselves genuine contenders.

"I think congrats first to them because they recovered and improved the speed of their car," Binotto said.

"But they were seven tenths off the pace in qualifying, which is still a lot on a short circuit. [In the race] they finished 30 seconds or more from the Red Bull, and it could have been maybe 40 seconds to Charles [Leclerc].

"40 seconds, 66 laps, is still six, seven-tenths per lap which is still significant. It's like Ferrari last year."