Mercedes say their power unit advantage is minimal, but race results show otherwise and is between 0.2 and 0.4 seconds per lap.
Last week F1 cancelled the Bahrain and Saudi Arabian Grand Prix's due to conflict in the region which is bad news for Mercedes and all other teams using their engines. Everyone knows the Mercedes team has been using a loop hole in the new regulations. The compression test the engines have to be compliant with is done under non racing conditions when the engine is in non racing mode.
From 1st June the new test regulations will be done under hot racing conditions which is expected to reveal Mercedes advantage and will be deemed illegal. The current power unit somehow by passes the current regulations changing the compression ratio when running hot allowing the car to lap their closest rivals by 0.4 seconds per lap.
The Mercedes team has a clear advantage currently which has allowed them to finish first and second in the first two races of the season. Removing these two races which have many fast straights which would have been heavily favoring a Mercedes victory now gives teams like Ferrari some hope.
Japan and Miami which are circuits with many more corners is their only hope until the testing regulations change on June 1st. Chances are Mercedes could win the first 5 races until Monaco on June 7th which is better than 7 wins which was most likely. Ferrari are the only team who have been competing with Mercedes and will at least have 17 races to catch Mercedes up as they should have a decent lead by then.
Ferrari look like they have the best car and definitely with the car having a smaller turbo they have a far quicker start which is an advantage others do not have. The start is key on most of the tracks if the power units are all equal or similar. The fact that Ferrari has been competitive with Mercedes even though they are not as fast on the straights bodes very well for after June 1st.
Ferrari have not really had a competitive car over the last few years and finally it looks like they have a solid package that could win the title this season. After Japan in two weeks time there will be a 4 week gap between the next race in Miami which will allow teams to improve their cars by adding and testing various upgrades. Would it be worthwhile to use the Mercedes advantage for only 2 races if they knew what to do knowing it would be illegal after June 1st?
My guess is teams including Mercedes will be working to improve every aspect of their car including the power unit. Mercedes will be 0.4 seconds per lap slower unless they can find some improvements which should be expected. All the teams will be constantly improving due to the data they are recording throughout the season and generally find anywhere between 1.5 and 2 seconds per lap over the course of 1 season.
These are early days with a totally new car with new regulations so the teams are continually learning finding ways to find extra speed. These are the top engineers in motor racing and why grey areas can be found and regulations are always pushed to the limit. Mercedes benefitted through the wording and testing conditions for the compression test and other teams did not see what they saw. Being smart is not necessarily cheating and this loop hole could be worth $100 million or more in points by the time the loop hole is closed.