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Daniel Ricciardo says his Red Bull Formula 1 team showed its full potential in Friday practice for the German Grand Prix.

The Australian finished second practice in third position, just a tenth of a second behind the dominant Mercedes of Lewis Hamilton and Nico Rosberg.

Ricciardo said Red Bull's chances of fighting with the German squad this weekend will depend on how much pace Mercedes is hiding, admitting he had extracted the maximum from his car.

"Unlike other Fridays I don't think we have got half a second in the car," said Ricciardo.

"We have extracted pretty much all of it today - so let's see.

"Maybe the track will keep evolving and help us out tomorrow, but I think today the pure pace we have is quite representative to our performance.

"Hopefully that was the best Mercedes pace as well and then we can have a fight on our hands.

"Tomorrow is the important one. They have done it before, they have turned up in qualifying and pulled half a second on everyone."

Team-mate Sebastian Vettel, eighth quickest and eight tenths of a second slower than Ricciardo, believes the gap to Mercedes has been reduced.

"I think we are maybe a bit closer than previous weekends, but it is close between us, Ferrari and Williams as well," he said.

Both drivers also agreed that removing the FRIC system had not changed much in terms of performance for Red Bull.

"I don't think it makes a big difference for us," said Vettel. "It is more relevant for other people. I haven't seen much yet."

Ricciardo added: "It is more just the ride itself: the bumps, kerbs, you feel them a little bit more, you don't have that extra support.

"But in terms of balance and the way the car behaves, it doesn't change much."