Raikkonen, the 2007 world champion, re-joined Ferrari at the start of the year but mediocre form had led to rumours the Formula One giants were exploring other options.
Ferrari president Sergio Marchionne said earlier in the summer Raikkonen's future lay in his own hands, which was interpreted as a clear signal for the Finn to make improvements amid what has been a mediocre start to his second spell with the Italians.
However on Wednesday Ferrari released a brief statement which said the "technical and racing agreement" they had with Raikkonen was being renewed.
Hamilton's Mercedes team-mate Nico Rosberg is second on 181, with Raikkonen down in fifth place on only 76 points.
Raikkonen admitted he has been given a fresh opportunity to show he is committed to the Ferrari cause.
"What can I say? For me, to be able to stay another year at Ferrari means that the dream goes on," he said in a team statement.
"The Scuderia is my family, as I always said, it's here I want to end my career.
Ferrari signed Vettel at the start of the year in a bid to put th brakes on several years of underperforming and seeing Red Bull dominate the sport.
While Vettel has remained competitive so far this season, new team principal Maurizio Arrivabene said he expected Raikkonen to repay the confidence the team have shown in him.
"We believe that extending Kimi's contract into the next season will provide further stability to the team," said Arrivabene.
"This has been our guideline, also considering the very good relationship between Kimi and Seb.
You’ve reached your limit of {{free_limit}} free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →
Smart Quarterly
₹900
3 Months
₹300/Month
Smart Essential
₹2,700
1 Year
₹225/Month
Super Saver
₹3,900
2 Years
₹162/Month
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors


Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share


Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor


Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements


Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
