"With this action both countries will remain with three consulates each", the State Department says, referring to the effort as an attempt to "arrest the downward spiral in our relationship".
In addition to the San Francisco consulate, the State Department decision affects the residence for the consul-general in the California city as well as two buildings that housed Russia's trade mission to the U.S. in NY and Washington, according to the USA official.
State Department spokeswoman Heather Nauert said the United States has fully complied with Russia's demand to reduce staff at the U.S. Embassy in Moscow and at a smaller facility in St. Petersburg.
In making the announcement, Mr. Putin said Russian Federation had run out of patience waiting for relations with the United States to improve.
The move represents not-so-warm a welcome for Anatoly Antonov, Russia's new ambassador to the United States, who just arrived in Washington after being officially appointed by Russian President Vladimir Putin on August 21.
Back in Washington, a senior administration official told reporters on a conference call that the United States would not be expelling any Russian personnel through this action, and that the Russian government could reassign its staff to other consulates or annexes. The administration took pains to say the move was purely reciprocal, and was not created to further escalate tensions between the United States and Russian Federation. Russia's new Ambassador to the U.S. Anatoly Antonov begins his post Friday.
Nauert warned that the US could have gone further, in pursuit of "parity" in diplomatic staffing levels, but chose not to in order to avoid a "downward spiral" in the relationship. The U.S. now operates consulates in the Russian cities of Petersburg, Yekaterinburg, and Vladivostok, in addition to the embassy in Moscow.
The law, overwhelmingly approved by a bipartisan majority in the two chambers of Congress, includes sanctions affecting the Russian oil and mining industries in response to Moscow's presumed interference in the 2016 presidential elections to harm Democratic nominee Hillary Clinton, who was ultimately defeated by Trump.
Putin's move was a delayed reaction to President Barack Obama's expulsion of 35 Russian diplomats and his seizure of two Russian diplomatic compounds past year.
Secretary of State Rex Tillerson informed Russia's foreign minister, Sergey Lavrov, of the tit-for-tat move in a phone call Thursday morning.