Lewis Hamilton is back in the fight for the world championship, according to Niki Lauda.

The Mercedes team chairman's assertion follows his comments last week saying that the Briton needed a retirement from Ferrari's Sebastian Vettel in order to have a real chance.

"No, that was exaggerated," the F1 legend told Osterreich.

"The championship is still long enough. Hopefully the Hamilton-Vettel duel will remain tense all the way to the end."

Lauda was speaking in Montreal, where a troubled race for Ferrari's Vettel allowed Hamilton to close the points deficit from 25 to just 12 points.

"Sebastian was unfortunate," said the Austrian, "but Lewis dominated from the start and our car was the best."

It was a clear turnaround for Mercedes, after the Monaco slump.

"The guys back at the factory have worked so hard to fix what we had in the last race, to bring it here and give it to the Ferraris," said Hamilton.

The British driver said that Canada was a "blow" to Ferrari, but German Vettel insists that is not worried.

"For Baku I am comforted," he said, "because we could have had a better result here."

Mercedes lead the championship by eight points following the race in Montreal.