Hamilton will serve a five-second time penalty for Sunday’s grand prix in Brazil after Mercedes opted to fit a new internal combustion engine (ICE) - his fifth of the season - on his car. 

Each driver is only permitted to use three ICE elements throughout the course of the campaign. 

Hamilton was given a 10-place grid penalty at the Turkish Grand Prix when he initially exceeded his engine allocation, with every change beyond that triggering a five-place grid penalty. 

"We have deg[radation] on the engine that, until the end of the season, is just going to continue to decrease in power,” Wolff told Sky Sports. 

“We haven't yet realised why that is, we're just seeing it creep down.”

Asked how many engines Hamilton still has available to him, Wolff replied: “Just the new one, and the current one.” 

Wolff added that he believes Hamilton’s latest V6 will be the “final one that we need to take” before the end of the 2021 season. 

"We have seen that over the past years that over 1000 kilometres, there is a certain amount of kilowatts that the engine is degrading,” he explained. 

“Ours is just degrading much more than the average of the past few years and that increases from weekend to weekend. 

“So, if we keep the engine, we are, for sure, not going to be competitive in Saudi Arabia and Abu Dhabi.”

The penalty is a blow to Hamilton’s hopes of winning a record-breaking eighth world title, with the Briton trailing Verstappen by 19 points in the championship going into the final four races. 

But Wolff hopes the return of F1’s experimental sprint format at Interlagos can still provide Hamilton an opportunity, and that the decision will ultimately pay off in the long run. 

"Well, we hope so that there is opportunity," Wolff said.

"Obviously, Saudi [Arabia] looks like a good opportunity too but we think, by then, the motor is going to lose more power. 

"So, in terms of our simulations, it's the right place to do it.”